Press Releases

"Despite the effect of rising rates and a slowing economy, Wachovia showed good growth in operating earnings," said L.M. Baker Jr., chairman and chief executive officer. "In this challenging environment loans continued to grow while we aggressively managed credit risk. Fee income sources show positive momentum aside from softness in certain market-sensitive business lines. Also evident are successful efforts to control expenses. In recent months, we have made difficult but necessary decisions that are on track to lift earnings and position Wachovia for the future."

Reported net income was $205.3 million or $1.00 per diluted share for the third quarter and $587.6 million or $2.87 per diluted share for the first nine months of 2000. Reported earnings for the same periods of 1999 were $257.5 million or $1.25 per diluted share and $748.3 million or $3.62 per diluted share, respectively. Included in reported earnings for the third quarter were $11.9 million, pretax, in merger-related expenses and $87.9 million, pretax, in restructuring charges associated with the previously announced resource realignment. The resource realignment is part of an ongoing performance project designed to lift Wachovia’s pretax earnings by $425 million by the end of 2002. Related staff reductions are expected to produce annual expense savings in excess of $100 million beginning first quarter 2001. Remaining restructuring charges of approximately $30 million will be incurred in the next two quarters.

Total revenue rose $100.3 million or 9.5 percent from the third quarter of 1999 and $336.4 million or 11.1 percent from the first nine months of 1999. The net yield on interest earning assets declined from 4.29 percent for third quarter 1999 to 4.09 percent for third quarter 2000 as a result of securitization transactions, interest reversals on nonperforming loans and interest rate spread compression. Adjusting for credit card securitizations and purchase acquisitions, total revenue increased approximately 7 percent for the third quarter and year to date compared with the same periods in 1999. Taxable equivalent net interest income was up $13.2 million or 2.1 percent for the quarter and $46 million or 2.5 percent for the first nine months of 2000. Average loans rose $5.8 billion or 12.2 percent for the third quarter and $5.1 billion or 10.8 percent year to date, led by the commercial and residential real estate loan portfolio. Increases in total other operating revenue for both reporting periods were concentrated in investment fees, credit card income, deposit service charges and credit card processing fees. The third quarters of 2000 and 1999 include branch sale gains of $41.6 million and $7.6 million, respectively, and net securitization gains of $9.0 million and $9.9 million, respectively.

As anticipated, the provision for loan losses and nonperforming assets increased as a result of continued concerns about the slowing economy and its impact on the financial performance of some corporate customers. The provision for loan losses was
$124 million for the three months and $471 million for the first nine months of 2000 compared with $76.8 million and $231.9 million in 1999. At September 30, 2000, nonperforming assets were $462 million, up $163 million from the preceding quarter. Net loan losses were $123.8 million or .94 percent of average loans for the quarter and $270.1 million or .70 percent of average loans year to date. Excluding credit cards, net loan losses were .64 percent of loans for the quarter and .34 percent of loans for the first nine months of 2000 compared with .24 percent and .17 percent for the respective 1999 periods.

Operating expense, excluding nonrecurring charges, was higher by $36.9 million or 6.5 percent for the third quarter and
$204.7 million or 12.5 percent year to date. Increases reflected a higher expense base due to acquisitions and were concentrated in personnel, occupancy costs, amortization of intangible assets and credit card processing costs. Adjusting for acquisitions, operating expense was flat compared with third quarter 1999 and increased about 2 percent for the first nine months compared with the same period a year ago.

Wachovia will host a conference call at 9:30 a.m. (Eastern Time) on October 18, 2000. The live conference call will be available at 913-981-4911. The conference call will be available for replay from 12:30 p.m., October 18, 2000, until midnight, October 22, 2000, at 719-457-0820 using access code 452355.

This news release contains forward-looking statements regarding Wachovia Corporation. All forward-looking statements involve risk and uncertainty and actual results could differ materially from the anticipated results or other expectations expressed in the forward-looking statements. A discussion of factors that could cause actual results to differ materially from those expressed in the forward-looking statements is included in Wachovia's filings with the Securities and Exchange Commission.

Additional information can be found in the Investor Relations section of Wachovia’s Web site at www.wachovia.com/investor.

Reported net income was $205.3 million or $1.00 per diluted share for the third quarter and $587.6 million or $2.87 per diluted share for the first nine months of 2000. Reported earnings for the same periods of 1999 were $257.5 million or $1.25 per diluted share and $748.3 million or $3.62 per diluted share, respectively. Included in reported earnings for the third quarter were $11.9 million, pretax, in merger-related expenses and $87.9 million, pretax, in restructuring charges associated with the previously announced resource realignment. The resource realignment is part of an ongoing performance project designed to lift Wachovia’s pretax earnings by $425 million by the end of 2002. Related staff reductions are expected to produce annual expense savings in excess of $100 million beginning first quarter 2001. Remaining restructuring charges of approximately $30 million will be incurred in the next two quarters.

Total revenue rose $100.3 million or 9.5 percent from the third quarter of 1999 and $336.4 million or 11.1 percent from the first nine months of 1999. The net yield on interest earning assets declined from 4.29 percent for third quarter 1999 to 4.09 percent for third quarter 2000 as a result of securitization transactions, interest reversals on nonperforming loans and interest rate spread compression. Adjusting for credit card securitizations and purchase acquisitions, total revenue increased approximately 7 percent for the third quarter and year to date compared with the same periods in 1999. Taxable equivalent net interest income was up $13.2 million or 2.1 percent for the quarter and $46 million or 2.5 percent for the first nine months of 2000. Average loans rose $5.8 billion or 12.2 percent for the third quarter and $5.1 billion or 10.8 percent year to date, led by the commercial and residential real estate loan portfolio. Increases in total other operating revenue for both reporting periods were concentrated in investment fees, credit card income, deposit service charges and credit card processing fees. The third quarters of 2000 and 1999 include branch sale gains of $41.6 million and $7.6 million, respectively, and net securitization gains of $9.0 million and $9.9 million, respectively.

As anticipated, the provision for loan losses and nonperforming assets increased as a result of continued concerns about the slowing economy and its impact on the financial performance of some corporate customers. The provision for loan losses was $124 million for the three months and $471 million for the first nine months of 2000 compared with $76.8 million and $231.9 million in 1999. At September 30, 2000, nonperforming assets were $462 million, up $163 million from the preceding quarter. Net loan losses were $123.8 million or .94 percent of average loans for the quarter and $270.1 million or .70 percent of average loans year to date. Excluding credit cards, net loan losses were .64 percent of loans for the quarter and .34 percent of loans for the first nine months of 2000 compared with .24 percent and .17 percent for the respective 1999 periods.

Operating expense, excluding nonrecurring charges, was higher by $36.9 million or 6.5 percent for the third quarter and
$204.7 million or 12.5 percent year to date. Increases reflected a higher expense base due to acquisitions and were concentrated in personnel, occupancy costs, amortization of intangible assets and credit card processing costs. Adjusting for acquisitions, operating expense was flat compared with third quarter 1999 and increased about 2 percent for the first nine months compared with the same period a year ago.

_{Wachovia will host a conference call at 9:30 a.m. (Eastern Time) on October 18, 2000. The live conference call will be available at 913-981-4911. The conference call will be available for replay from 12:30 p.m., October 18, 2000, until midnight, October 22, 2000, at 719-457-0820 using access code 452355.}

_{This news release contains forward-looking statements regarding Wachovia Corporation. All forward-looking statements involve risk and uncertainty and actual results could differ materially from the anticipated results or other expectations expressed in the forward-looking statements. A discussion of factors that could cause actual results to differ materially from those expressed in the forward-looking statements is included in Wachovia's filings with the Securities and Exchange Commission.}

Additional information can be found in the Investor Relations section of Wachovia’s Web site at www.wachovia.com/investor.