<PAGE>
[BANK ONE CORPORATION Press Release Letterhead] Exhibit 99(a)
FOR IMMEDIATE RELEASE
---------------------
BANK ONE REPORTS:
. $1.3 BILLION SECOND QUARTER LOSS INCLUDING SIGNIFICANT ITEMS
. STRONG PERIOD-END CAPITAL POSITION
. 50% REDUCTION IN COMMON STOCK DIVIDEND TO $0.21 PER SHARE PAYABLE
OCTOBER 1, 2000
. $500 MILLION EXPENSE CUT TARGET
CHICAGO, July 19, 2000 - BANK ONE CORPORATION (NYSE: ONE) today announced a 2000
second quarter net loss of $1.269 billion, or $1.11 per diluted share. This
compares with net income in the 1999 second quarter of $992 million, or $0.83
per share. For the first half of 2000, the net loss totaled $580 million, or
$0.51 per share, compared with net income of $2.143 billion, or $1.79 per share,
for the first six months of last year.
"Our top priority is to quickly position Bank One to compete more effectively
and enter 2001 in the strongest financial position possible," said James Dimon,
chairman and chief executive officer. "Decisions made this quarter move us
decisively forward. We are taking strong medicine to build a healthier future."
Key actions in the quarter included:
. Charges totaling $1.913 billion after tax strengthen the integrity of the
balance sheet.
. After the charges, the company maintains a strong capital position, including
a tangible common equity to managed assets ratio of 5.4% at June 30, 2000.
. A 50% reduction in the common stock dividend payable October 1, 2000.
. A rededication to customer service with increased empowerment of front line
employees to serve customer needs and make decisions. This includes the roll-
out of new banking center computer platforms that will improve customer
service and employee responsiveness.
. Decisions to collapse the 20 domestic bank charters to three, and convert the
seven demand deposit systems into one.
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. The implementation of an aggressive waste-reduction program that will reduce
annualized noninterest expense $500 million pretax, after the above systems
conversion costs and infrastructure investments. A key focus will be to drive
down non-headcount-related expenses, though headcount will decline primarily
through attrition. We began the year with 86,600 employees, have reduced that
to 82,500 today and expect to stay at this level, even with business growth.
No expense cuts will impact customer service, technology investments or other
investment spending.
. A significant strengthening of the management team with the hiring of a new
chief financial officer, chief legal officer and head of strategic planning,
along with the appointment of new business heads for Middle Market Banking
and Commercial Banking.
During the second quarter, management began a detailed review of all of the
businesses. This review revealed much strength within the company, including a
strong mix of businesses with the potential for increased synergies and
franchises with significant market shares positioned for growth.
"Having a strong balance sheet and financial structure, a great management team,
and building first-class infrastructure and execution capabilities are the
foundation for building a great company. We are committed to making Bank One a
top performing company," Dimon said.
"I am very proud of the dedication and effort of all our employees who are
working to re-establish Bank One as a financial services powerhouse with top
flight products and customer service," Dimon said. "But we are just getting
started. Behind all the noise, Bank One's quarterly net earnings power today is
roughly $650 million, or about $0.55 per share. We must do better if we are to
properly reward our customers, employees and shareholders. We are confident
that we can substantially improve the earnings power of the company in the
future."
SIGNIFICANT ITEMS IN THE QUARTER
Reflecting the above detailed review, decisions were made that resulted in
charges totaling $2.940 billion pretax ($1.913 billion after tax, $1.66 per
share).
In Retail, $518 million pretax of charges were made primarily consisting of:
. A $307 million pretax addition to the auto lease residual reserve caused by
continuing deterioration in used-vehicle prices, and
. A $167 million pretax write down primarily in vehicle-related assets
associated with the planned disposition of certain pools of underperforming
or non-strategic indirect vehicle loans and business restructuring.
Commercial Banking was impacted by $673 million of significant items, primarily
a $647 million addition to the allowance for credit losses. This addition
reflected significant deterioration during the quarter in the commercial lending
portfolio, continued refinements in the methodology to assess inherent losses,
and an assessment of the current economic environment.
In First USA, $777 million pretax in asset impairment write downs were taken
caused by continuing reductions in the cash flows associated with certain
assets, driven by compressed interest margins, reduced fee revenue and higher
credit costs. These asset write downs include:
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. $354 million pretax related to the value of the interest-only strip of
securitized receivables,
. $275 million pretax related to purchased credit card relationship
intangibles, and
. $121 million pretax related to marketing partnership agreements.
In Corporate / Unallocated, $963 million pretax of charges consisting mainly of:
. $415 million pretax of investment securities losses of which $365 million
related to the decision to reposition the portfolio, as well as $50 million
of realized losses,
. A $190 million pretax increase in the legal accruals to cover increased
corporate and business litigation exposure,
. $141 million pretax of charges for abandoned facilities by the lines of
business, and
. $100 million pretax of charges for correcting operational errors.
In addition to the above items, the current quarter included $68 million in net
gains on the previously announced sale of the First USA credit card operations
in Canada and the U. K. for $46 million and from the sale of unsecured loans by
Retail for $22 million.
After these actions, the Company's June 30 capital ratios continue to be strong.
Tier 1 and total capital ratios at June 30 were 7.1% and 10.2%, respectively,
compared with 7.7% and 10.6% at March 31, 2000.
The 1999 second quarter included $179 million pretax ($120 million after tax,
$0.10 per share) of merger-related costs and other items.
COMMON STOCK DIVIDEND DECLARED
The Board of Directors today declared a cash dividend of 21 cents per share on
outstanding common stock, payable October 1, 2000, to shareholders of record on
September 15, 2000. This dividend represents a 50% reduction from the previous
quarterly dividend of 42 cents per share.
"Reducing the dividend is a difficult decision but is absolutely the right thing
to do," Dimon said. "To win, we have to quickly place Bank One in a position
of strong competitive advantage. This reduction improves capital management
flexibility and expands the choices for building long-term value for our
shareholders, something we are absolutely committed to. We now will have more
capacity to invest in our businesses, grow earnings and create the capacity to
buyback stock when appropriate. We believe these actions, and others we are
taking, will ultimately create more wealth for our shareholders."
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<PAGE>
LINE OF BUSINESS DISCUSSION
Highlights - Net Income (Loss) by Line of Business
<TABLE>
<CAPTION>
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($ millions) % change vs.
2Q99 1Q00 2Q00 2Q99 1Q00
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Retail $ 290 $236 $ (81) (128)% (134)%
Commercial banking 203 200 (213) NM NM
First USA 339 67 (379) NM NM
Investment management 91 81 73 (20) (10)
Corporate investments 90 141 61 (32) (57)
Corporate / unallocated 99 (36) (730) NM NM
------ ---- -------
Total business segment results $1,112 $689 $(1,269) NM NM
Merger-related items and
significant items
(120) 0 0 NM NM
------ ---- -------
Total Corporation $ 992 $689 $(1,269) NM NM
Note: Amounts may not add due to rounding
NM = not meaningful
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</TABLE>
Retail
<TABLE>
<CAPTION>
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Income Statement ($ millions)
Balance Sheet ($ billions) % change vs. Adjusted
2Q99 1Q00 2Q00 2Q99 1Q00 2Q00
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Net interest income (1) $1,082 $1,236 $1,196 11% (3)% $1,205
Provision 83 167 132 59 (21) 121
Noninterest income 408 306 (95) (123) (131) 330
Noninterest expense 962 1,002 1,097 14 9 1,024
Net income (loss) 290 236 (81) (128) (134) 247
Return on equity 25% 18% (6)% 17%
Efficiency ratio 65 65 100 67
Loans - average $ 64.9 $ 73.1 $ 73.6 13 1 $ 73.6
Assets - average 71.4 79.6 77.9 9 (2) 77.9
Deposits - average 89.2 88.3 89.4 -- 1 89.4
Common equity - average 4.6 5.3 5.9 28 11 5.9
Note: Amounts may not add due to rounding
NM = not meaningful
(1) Fully taxable equivalent basis
------------------------------------------------------------------------------------------------
</TABLE>
Retail reported a net loss of $81 million, a decrease of $371 million from the
year-ago quarter. Earnings for the second quarter were affected by $518 million
pretax of significant items as previously discussed. Excluding the impact of
these items, on an adjusted basis Retail earnings were $247 million.
Net interest income of $1.196 billion increased $114 million, or 11%, from the
prior year, primarily driven by wider deposit spreads and a 13% increase in loan
volume. Loan growth has occurred mainly in home equity loans, up 39% from a
year ago. The $40 million decline in net interest income from the first quarter
reflected the first quarter loan sale to Household International, Inc., and the
impact of normal tax-related lending seasonality.
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Provision expense was $132 million for the quarter, an increase of $49 million
from the year-ago quarter and a decline of $35 million from the first quarter.
The year-over-year increase can be attributed to loan growth and the impact of
adopting the FFIEC's revised consumer loan charge-off guidelines. The decline
from the first quarter reflected loan sales and the impact of first quarter tax-
related lending.
Noninterest income declined $503 million from the year-ago quarter reflecting
the impact of $425 million of significant items. Excluding these items,
noninterest income decreased due to higher auto lease residual losses realized
and lower loan sale gains. On the same basis, noninterest income increased from
the prior quarter due to higher loan and deposit fees, increased student loan
fees and higher interchange fees.
Noninterest expense of $1.097 billion increased $135 million from the year-ago
quarter and $95 million from the first quarter. Excluding $73 million of pretax
significant items, WingspanBank, which was launched late in the year-ago
quarter, was the primary driver of the year-over-year increase. On the same
basis, the increase from the prior quarter reflected seasonal marketing expense.
Commercial Banking
<TABLE>
<CAPTION>
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Income Statement ($ millions)
Balance Sheet ($ billions) % change vs. Adjusted
2Q99 1Q00 2Q00 2Q99 1Q00 2Q00
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Net interest income (1) $ 628 $ 664 $ 694 11% 5% $ 694
Provision 108 132 778 NM NM 150
Noninterest income 329 354 312 (5) (12) 356
Noninterest expense 538 570 564 5 (1) 563
Net income (loss) 203 200 (213) NM NM 214
Return on equity 14% 13% (13)% 13%
Efficiency ratio 56 56 56 54
Loans - average $ 73.0 $ 80.4 $ 82.1 12 2 $ 82.1
Assets - average 104.4 110.2 110.2 6 -- 110.2
Deposits - average 37.4 39.2 40.9 9 4 40.9
Common equity - average 5.8 6.2 6.7 16 8 6.7
Note: Amounts may not add due to rounding
NM = not meaningful
(1) Fully taxable equivalent basis
------------------------------------------------------------------------------------------
</TABLE>
Commercial Banking reported a net loss of $213 million in the second quarter,
driven primarily by a significant increase in credit losses as reflected in
higher credit provisions. Excluding the impact of this quarter's significant
items, Commercial Banking's adjusted earnings were $214 million.
Net interest income of $694 million increased $66 million, or 11%, from the
year-ago quarter, reflecting 12% average loan growth. Large Corporate and
Middle Market loans grew 19% and 12%, respectively. This benefit was partially
offset by a slight decline in the net interest margin, reflecting competitive
pricing pressures in both the Middle Market and Large Corporate markets as well
as higher interest rates.
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<PAGE>
The provision for credit losses was $778 million, up $670 million year-over-
year, attributable to the loan loss provisions taken this quarter for the
significant deterioration in the commercial portfolio spread across several
industries, including leveraged acquisition finance transactions.
Noninterest income of $312 million declined $17 million, or 5%, year-over-year,
primarily reflecting weakness in market driven revenue. Poor trading results in
the high yield and corporate portfolios resulted in a decline in market-driven
revenue of $47 million year-over-year and also accounted for the decline from
the first quarter. Partially offsetting this weakness was solid growth in
treasury management-related revenues, which were up 12% from the year-ago
quarter. Fee income was also strong in the quarter in syndicated lending, where
volume increased significantly over the first quarter due to increased market
activity, improved share and business mix. Excluding the impact of the
significant items, noninterest income increased 8% year-over-year.
Noninterest expense was $564 million, up $26 million, or 5%, from the year-ago
quarter. This reflected modest increases in several expense categories.
Expenses were down 1% from the first quarter, reflecting efficiency gains as
staffing levels have been managed flat to down since the end of last year.
First USA
<TABLE>
<CAPTION>
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Income Statement ($ millions)
Balance Sheet ($ billions) % change vs. Adjusted
2Q99 1Q00 2Q00 2Q99 1Q00 2Q00
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Net interest income (1) $1,781 $1,525 $1,451 (19)% (5)% $1,451
Provision 898 969 935 4 (4) 900
Noninterest income 455 264 (153) (134) (158) 307
Noninterest expense 818 715 961 17 34 679
Net income (loss) 339 67 (379) NM NM 113
Return on outstandings (pretax) 3.0% 0.6% (3.6)% 1.1%
Return on equity 23 4 (25) 7
Efficiency ratio 37 40 74 39
Managed net charge-off ratio 5.25 5.78 5.44 5.44
Loans - average $ 68.9 $ 67.1 $ 66.1 (4) (1) $ 66.1
Assets - average 75.0 72.8 70.6 (6) (3) 70.6
Common equity - average 6.0 6.2 6.1 2 (2) 6.1
Note: Amounts may not add due to rounding
NM = not meaningful
(1) Fully taxable equivalent basis
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</TABLE>
First USA reported a net loss of $379 million, a decrease of $718 million from
the year-ago quarter. Earnings for the second quarter were affected by several
items, primarily impairment-related asset write-downs totaling $777 million
pretax. Excluding these items, adjusted earnings were $113 million after tax
with a pretax return on outstandings of 1.1% for the quarter, up from 0.6% in
the prior quarter.
Net interest income of $1.451 billion decreased $330 million, or 19%, from the
year-ago quarter due to margin compression resulting from the attrition of
higher priced accounts, reduced margins and lower outstandings.
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<PAGE>
The provision declined $34 million from the first quarter reflecting continued
improvement in delinquency trends and a reduction in managed charge-offs.
Compared with the first quarter, the managed delinquency rates for 30 and 90
days declined from 4.08% to 3.83% and from 1.91% to 1.69%, respectively. The
managed charge-off rate declined to 5.44% from 5.78% in the prior quarter.
Noninterest income declined $608 million from the prior year primarily related
to the impairment write downs on the interest-only strip and affinity
partnership agreements, which totaled $460 million pretax, net of a $46 million
gain on the sales of the Canadian and U.K. credit card operations. The prior
year quarter included net securitization gains of $50 million compared with net
securitization amortization of $30 million in the current quarter. Noninterest
income increased from the first quarter due to the seasonal benefit of higher
interchange income.
Excluding this quarter's $275 million pretax write down of purchased credit card
intangible assets and other adjustments, noninterest expense declined $139
million, or 17%, from the prior year. Expense saving initiatives including
staff reductions, lower processing costs and reduced marketing expense drove
this improvement.
Compared to the year-ago period, average outstandings decreased approximately
4%. At quarter-end, First USA had 54.6 million cards issued. About 826,000 new
accounts were opened during the quarter. Overall attrition levels continue to
improve and are performing better than expected.
Investment Management
<TABLE>
<CAPTION>
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Income Statement ($ millions)
Balance Sheet ($ billions) % change vs. Adjusted
2Q99 1Q00 2Q00 2Q99 1Q00 2Q00
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Net interest income (1) $ 99 $ 100 $ 101 2% 1% $ 101
Provision 0 2 2 NM -- 2
Noninterest income 295 287 288 (2) -- 288
Noninterest expense 255 257 272 7 6 263
Net income 91 81 73 (20) (10) 79
Return on equity 41% 36% 33% 35%
Efficiency ratio 65 66 70 68
Loans - average $ 5.7 $ 6.4 $ 6.5 14 2 $ 6.5
Assets - average 7.1 7.7 7.5 6 (3) 7.5
Deposits - average 8.7 8.7 8.6 (1) (1) 8.6
Common equity - average 0.9 0.9 0.9 -- -- 0.9
Assets under management - average 124.7 126.9 129.4 4 2 129.4
Note: Amounts may not add due to rounding
NM = not meaningful
(1) Fully taxable equivalent basis
--------------------------------------------------------------------------------------------------------------------
</TABLE>
Investment Management net income declined $18 million, or 20%, from the year-ago
period. Results for the year-ago quarter included $26 million pretax of
nonrecurring gains.
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<PAGE>
Net interest income of $101 million increased 2% from the year-ago period.
Higher spread income associated with the 14% increase in average loans was
partially offset by a 1% decrease in average deposits.
Noninterest income of $288 million decreased $7 million, or 2%, year-over-year.
Excluding the impact of the sale of a subsidiary in the year-ago period,
noninterest income increased $18 million, or 7%, primarily driven by increased
revenue from private banking, investment products and institutional sales.
Noninterest expense of $272 million increased $17 million, or 7%, year-over-
year. Excluding the impact of the sale of a subsidiary in the year-ago period,
noninterest expense increased 3% reflecting increased commissions and processing
expense related to the higher sales volumes.
Assets under management increased to $129.4 billion, or 4%, from the year-ago
period. One Group(R) mutual fund assets under management increased 15% to $66.9
billion in the second quarter of 2000. This increase was partially a result of
assets shifting from individually managed assets to mutual funds. One Group(R)
fund performance continues to remain strong, with 90% of funds rated three stars
or better by Morningstar.
Corporate Investments
<TABLE>
<CAPTION>
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Income Statement ($ millions)
Balance Sheet ($ billions) % change vs. Adjusted
2Q99 1Q00 2Q00 2Q99 1Q00 2Q00
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Net interest income (1) $ 48 $ 35 $ 30 (38)% (14)% $ 30
Provision 0 1 1 NM -- 1
Noninterest income 97 185 52 (46) (72) 52
Noninterest expense 34 39 31 (9) (21) 31
Net income 90 141 61 (32) (57) 61
Return on equity 36% 47% 20% 20%
Efficiency ratio 23 18 38 38
Loans - average $3.4 $3.4 $3.5 3 3 $3.5
Assets - average 7.5 8.0 8.4 12 5 8.4
Common equity - average 1.0 1.2 1.2 20 -- 1.2
Note: Amounts may not add due to rounding
NM = not meaningful
(1) Fully taxable equivalent basis
--------------------------------------------------------------------------------------------------------------
</TABLE>
Corporate Investments net income of $61 million declined $29 million year-over-
year, as the year-ago quarter's performance was strong.
Net interest income of $30 million declined $18 million from the year-ago
quarter, largely a result of growth in non-interest bearing investments in
addition to higher funding costs. Lease spread income has declined modestly
reflecting a net increase in outstandings at lower yields.
Noninterest income was $52 million in the second quarter, down $45 million from
the year-ago quarter. Market-driven revenue, derived primarily from venture
capital and private equity investments, declined $18 million from the year-ago
quarter and $103 million from the particularly strong first quarter.
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<PAGE>
Weakness in the second quarter results reflects lower valuations on investments.
Other returns were similarly affected by market conditions.
Noninterest expense of $31 million declined 9% from the year-ago quarter and 21%
from the prior quarter, reflecting continued expense discipline. Lower
incentives and other market-related expenditures, a function of the slower
market activity, contributed to the expense decrease.
Corporate / Unallocated
<TABLE>
<CAPTION>
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Income Statement ($ millions)
Balance Sheet ($ billions) % change vs. Adjusted
2Q99 1Q00 2Q00 2Q99 1Q00 2Q00
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Net interest income (1) $ 37 $(115) $ (75) NM% 35% $ (75)
Provision (14) 0 0 100 NM 0
Noninterest income 105 118 (422) NM NM 10
Noninterest expense 18 78 582 NM NM 51
Net income (loss) 99 (36) (730) NM NM (70)
Assets - average $32.8 $35.3 $42.0 28 19 $42.0
Deposits - average 17.0 22.1 20.5 21 (7) 20.5
Common equity - average 2.5 0.0 (0.9) (136) NM (0.9)
Note: Amounts may not add due to rounding
NM = not meaningful
(1) Fully taxable equivalent basis
---------------------------------------------------------------------------------------------------------------
</TABLE>
Corporate/Unallocated reported a net loss of $730 million, a decrease of $829
million from the year-ago quarter and $694 million from the first quarter.
Earnings for the second quarter were impacted by $963 million pretax of
significant items, primarily losses on the restructuring of the investment
securities portfolio, increased legal accruals and charges for abandoned
facilities and correcting operational errors.
Net interest income in the current quarter represented a net expense of $75
million. Net interest income for this line of business represents the earnings
on the corporate investment securities portfolio, as well as the impact of
interest rate risk not allocated to the lines of business and the cost to carry
unallocated net assets. This net amount will vary from period to period as the
rate risk of the Corporation fluctuates and as the unallocated net asset
position changes.
There was no provision expense for the current quarter as this was fully
reflected in the appropriate lines of business. This should generally be the
case as Corporate/Unallocated seldom contains any loans or other assets that
would require a loss provision.
Noninterest income declined $527 million from the year-ago quarter and $540
million from the first quarter reflecting the impact of the $415 million
securities portfolio write down and other items in the second quarter.
Excluding these items, noninterest income was down versus a year ago due to
nonrecurring transactions in the 1999 quarter.
The increase in noninterest expense reflected the $531 million impact of
significant second quarter items. Excluding these impacts, the remaining
noninterest expense represents unallocated support costs that vary from quarter
to quarter.
-9-
<PAGE>
Credit Quality
Nonperforming assets were $1.784 billion at the end of the second quarter, up
$123 million from $1.661 billion at March 31, 2000. Nonperforming assets
include nonperforming commercial loans, other real estate owned and consumer
loans 90-days past due. The nonperforming asset ratio was 1.03% at June 30,
2000, and the allowance for credit losses was 1.73% of loans, compared with
0.99% and 1.39%, respectively, at March 31, 2000.
Total managed net charge-offs in the second quarter were $1.152 billion, or
1.99% of total average managed loans, down slightly from $1.176 billion, or
2.04% in the 2000 first quarter and comparable to the $1.075 billion, or 1.99%,
in the year-ago quarter. The managed loan loss provision of $1.846 billion in
the second quarter exceeded managed net charge-offs by $694 million, primarily
reflecting the $668 million increase to the allowance for credit losses included
in this quarter's significant items. This increase related to significant
deterioration during the quarter in the commercial lending portfolio, continued
refinements in the methodology to assess inherent losses, and an assessment of
the current economic environment.
Credit card managed net charge-offs were 5.44% in the second quarter compared
with 5.25% in the year-ago quarter, but down from 5.78% in the prior quarter.
Consumer loan net charge-offs of 0.82% were up from 0.61% in the year-ago
quarter and from 0.76% in the prior quarter. Commercial net charge-offs in the
2000 second quarter were 0.47%, up from 0.36% in year-ago quarter and 0.34% in
the first quarter reflecting the credit quality deterioration in the commercial
loan portfolio.
Capital Management
The common equity to managed assets ratio was 5.9% at June 30, 2000, down from
6.3% as of March 31, 2000. Tier 1 and total capital ratios were 7.1% and 10.2%,
respectively, down from 7.7% and 10.6%, respectively, as of March 31, 2000. The
decline in the capital ratios reflected the second quarter loss. Despite the
decline, these capital ratios remained very strong and exceed well-capitalized
regulatory guidelines.
BANK ONE CORPORATION is the nation's fifth largest bank holding company, with
assets of more than $270 billion. Bank One offers a full range of financial
services to commercial and business customers and consumers. It is the world's
second largest VISA/MasterCard issuer, the third largest bank lender to small
businesses, a leading national automotive lender, and one of the top 25 managers
of mutual funds. A leader in the retail market, Bank One operates more than
1,800 banking centers and a nationwide network of ATMs. In addition, it is a
major commercial bank in the United States and in select international markets.
Forward-looking Statement
The following appears in accordance with the Private Securities Litigation
Reform Act of 1995:
This discussion of financial results contains forward-looking statements about
the Company, including descriptions of plans or objectives of its management for
future operations, products or services, and forecasts of its revenues, earnings
or other measures of economic performance. Forward-looking statements can be
identified by the fact that they do not relate strictly to historical or current
facts. They often include the words "believe," "expect," "anticipate,"
"intend," "plan," "estimate" or words of similar meaning, or future or
conditional verbs such as "will," "would," "should," "could" or "may."
-10-
<PAGE>
Forward-looking statements, by their nature, are subject to risks and
uncertainties. A number of factors--many of which are beyond the Company's
control--could cause actual conditions, events or results to differ
significantly from those described in the forward-looking statements. The
Company's reports filed with the Securities and Exchange Commission, including
the Company's Form 10-K for the year ended December 31, 1999, describe some of
these factors, including certain credit, market, operational, liquidity and
interest rate risks associated with the Company's business and operations.
Other factors described in the Company's December 31, 1999 Form 10-K include
changes in business and economic conditions, competition, fiscal and monetary
policies and legislation including the Gramm-Leach-Bliley Act of 1999.
Forward-looking statements speak only as of the date they are made. The Company
does not undertake to update forward-looking statements to reflect circumstances
or events that occur after the date the forward-looking statements are made or
to reflect the occurrence of unanticipated events, such as further market
deterioration that adversely affects credit quality, auto lease residuals and
credit card asset values.
Line of Business Basis of Discussion
------------------------------------
In addition to showing reported results, solely for analytical purposes second
quarter results are also shown on an adjusted basis, which excludes the impact
of this quarter's significant items.
In addition, First USA's presentation is on a managed basis with information
modified from reported results to include credit card loans that were
securitized and removed from the balance sheet. The net revenue related to
these securitized loans are reclassified from noninterest income to net interest
income and provision for credit losses as if the securitization had not
occurred.
During the quarter, certain decisions were made related to the reporting of line
of business results. This included the reporting of additional segments, as
well as changes in the methodologies including the allocation of certain costs.
Prior disclosures have been restated to conform to the current methodologies.
As a result, the current line of business result presentation differs
significantly from that previously reported.
###
Information about Bank One's financial results can be accessed on the
Internet at www.bankone.com or through fax-on-demand at 877-ONE-FACT. A
meeting and conference call discussing the results will be held at 8:30 a.m.
(EDT) today at the St. Regis Hotel in New York City. To participate in the
conference call, phone 800-327-5188 (domestic) or 706-634-8048 (international);
the access code is 883393. The presentation handout will be available on the
Internet at www.bankone.com. A playback of this conference call will be
available after 1:00 p.m. today through Friday, July 28 by calling 800-642-1687
(domestic) or 706-645-9291 (international); the access code is 883393.
Media Contacts:
Thomas A. Kelly (312) 732-7007
Stan A. Lata (312) 732-6209
Investor Contacts:
Jay S. Gould (312) 732-5771
Sandra M. Catanzaro (312) 732-8013
Larry J. Peepo (312) 732-6638
-11-
<PAGE>
<TABLE>
<CAPTION>
BANK ONE CORPORATION and Subsidiaries
Summary of Selected Financial Information Three Months Ended
---------------------------------------------------------------
Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
($ millions, except per-share amounts) 2000 2000 1999 1999 1999
-------------------------------------- -------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
---------------------
Net interest income (FTE) $ 2,257 $ 2,228 $ 2,221 2,271 $ 2,341
Provision for credit losses 1,013 362 416 277 275
Noninterest income 288 1,821 1,782 2,098 2,222
Noninterest expense 3,507 2,661 3,030 2,713 2,806
Net income (loss) (1,269) 689 411 925 992
PER COMMON SHARE DATA
---------------------
Net income (loss) - basic $ (1.11) 0.60 $ 0.36 $ 0.79 $ 0.84
Net income (loss) - diluted (1) (1.11) 0.60 0.36 0.79 0.83
Cash dividends declared 0.42 0.42 0.42 0.42 0.42
Book Value 16.12 17.43 17.34 17.32 17.73
BALANCE SHEET DATA
------------------
Loans:
managed $234,412 $229,673 $229,196 $222,117 $218,795
reported 172,591 168,078 163,877 158,143 157,464
Deposits 163,169 164,643 162,278 156,900 156,454
Long-term debt 39,093 38,753 35,435 34,735 27,728
Total assets 272,709 273,008 269,425 264,135 256,033
Common stockholders' equity 18,630 20,081 19,900 19,860 20,860
Total stockholders' equity 18,820 20,271 20,090 20,050 21,050
Credit Quality
--------------
Net charge-offs to average loans 0.75% 0.64% 0.95% 0.68% 0.71%
Allowance for credit losses to loans outstanding 1.73 1.39 1.39 1.42 1.43
Nonperforming assets to related assets 1.03 0.99 1.02 1.06 1.03
FINANCIAL PERFORMANCE RATIOS
----------------------------
Net interest margin:
managed 4.80% 4.91% 4.98% 5.32% 5.55%
reported 3.77 3.78 3.79 4.04 4.26
Return on assets (1.87)% 1.03% 0.62% 1.44% 1.57%
Return on common equity (26.0) 13.9 8.2 18.2 19.1
Efficiency Ratio:
managed 103.8% 53.7% 62.1% 52.1% 52.3%
reported 137.8 65.7 75.7 62.1 61.5
EQUITY RATIOS
-------------
Regulatory leverage ratio 7.0% 7.7% 7.7% 7.9% 8.1%
Risk-based capital:
Tier 1 ratio 7.1 7.7 7.7 7.7 8.1
Total capital ratio 10.2 10.6 10.7 10.8 11.4
Common Stock Data
-----------------
Average shares outstanding, basic 1,153 1,149 1,147 1,167 1,180
Average shares outstanding, diluted (1) 1,153 1,155 1,154 1,177 1,195
Stock price, quarter-end $ 26.56 $ 34.38 $ 32.00 $ 34.81 $ 59.56
</TABLE>
(1) Common equivalent shares have been excluded from the computation of diluted
loss per share in the second quarter of 2000, as the effect would be
antidilutive
12
<PAGE>
BANK ONE CORPORATION and Subsidiaries
<TABLE>
<CAPTION>
Three Months Ended
------------------------------------------------------------
Consolidated Statement of Income Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
($ millions, except per-share amounts) 2000 2000 1999 1999 1999
--------------------------------------- ------- ------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
Interest income $ 4,966 $4,753 $4,548 $4,314 $4,236
Interest expense 2,745 2,560 2,360 2,072 1,925
-----------------------------------------------------------
Net interest income 2,221 2,193 2,188 2,242 2,311
Provision for credit losses 1,013 362 416 277 275
-----------------------------------------------------------
Net interest income after
provision for credit losses 1,208 1,831 1,772 1,965 2,036
-----------------------------------------------------------
Noninterest Income
Trading profits (losses) (3) 64 17 30 33
Equity securities gains 60 143 100 86 133
Investment securities gains (losses) (414) 15 2 6 34
-----------------------------------------------------------
Market-driven revenue (357) 222 119 122 200
Credit card revenue 477 578 714 897 873
Fiduciary and investment management fees 200 195 216 201 197
Service charges and commissions 694 713 701 671 723
-----------------------------------------------------------
Fee-based revenue 1,371 1,486 1,631 1,769 1,793
Other income (loss) (726) 113 32 207 229
-----------------------------------------------------------
Total noninterest income 288 1,821 1,782 2,098 2,222
-----------------------------------------------------------
Noninterest Expense
Salaries and benefits 1,132 1,098 1,081 970 1,073
Net occupancy and equipment expense 223 222 244 220 219
Depreciation and amortization 439 163 186 167 169
Outside services and processing 375 408 459 458 420
Marketing and development 245 226 230 341 302
Communication and transportation 207 212 216 205 208
Merger-related and restructuring charges 229 (19) 189 56 145
Other expense 657 351 425 296 270
-----------------------------------------------------------
Total noninterest expense 3,507 2,661 3,030 2,713 2,806
-----------------------------------------------------------
Income (loss) before income taxes (2,011) 991 524 1,350 1,452
Provision for income taxes (742) 302 113 425 460
-----------------------------------------------------------
Net income (loss) $(1,269) $ 689 $ 411 $ 925 $ 992
===========================================================
Net income (loss) attributable to common
stockholder's equity $(1,272) $ 686 $ 408 $ 922 $ 989
===========================================================
Earnings (loss) per common share
--Basic $ (1.11) $ 0.60 $ 0.36 $ 0.79 $ 0.84
--Diluted (1) $ (1.11) $ 0.60 $ 0.36 $ 0.79 $ 0.83
Average common shares outstanding (millions)
--Basic 1,153 1,149 1,147 1,167 1,180
--Diluted (1) 1,153 1,155 1,154 1,177 1,195
</TABLE>
(1) Common equivalent shares have been excluded from the computation of diluted
loss per share in the second quarter of 2000, as the effect would be
antidilutive.
13
<PAGE>
BANK ONE CORPORATION and Subsidiaries
<TABLE>
<CAPTION>
Six Months Ended
----------------
Consolidated Statement of Income Jun 30 Jun 30
($ millions, except per-share amounts) 2000 1999
------------------------------------------------------------- ------- ------
<S> <C> <C>
Interest income $ 9,719 $8,432
Interest expense 5,305 3,841
----------------
Net interest income 4,414 4,591
Provision for credit losses 1,375 556
----------------
Net interest income after provision for credit losses 3,039 4,035
----------------
Noninterest Income
Trading profits 61 100
Equity securities gains 203 229
Investment securities gains (losses) (399) 86
----------------
Market-driven revenue (135) 415
Credit card revenue 1,055 1,802
Fiduciary and investment management fees 395 376
Service charges and commissions 1,407 1,413
----------------
Fee-based revenue 2,857 3,591
Other income (loss) (613) 806
----------------
Total noninterest income 2,109 4,812
----------------
Noninterest Expense
Salaries and benefits 2,230 2,220
Net occupancy and equipment expense 445 446
Depreciation and amortization 602 344
Outside services and processing 783 826
Marketing and development 471 617
Communication and transportation 419 408
Merger-related and restructuring charges 210 309
Other expense 1,008 577
----------------
Total noninterest expense 6,168 5,747
----------------
Income (loss) before income taxes (1,020) 3,100
Provision for income taxes (440) 957
----------------
Net income (loss) $ (580) $2,143
================
Net income (loss) attributable to common stockholder's equity $ (586) $2,137
================
Earnings per common share
--Basic $ (0.51) $ 1.81
--Diluted (1) $ (0.51) $ 1.79
Average common shares outstanding (millions)
--Basic 1,150 1,179
--Diluted (1) 1,150 1,194
</TABLE>
(1) Common equivalent shares have been excluded from the computation of diluted
loss per share in the second quarter of 2000, as the effect would be
antidilutive.
14
<PAGE>
BANK ONE CORPORATION and Subsidiaries
<TABLE>
<CAPTION>
Consolidated Balance Sheet Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
($ millions) 2000 2000 1999 1999 1999
------------------------------------------------------------- ----------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Assets
Cash and due from banks $ 16,470 $ 15,267 $ 16,076 $ 15,325 $ 15,336
Interest bearing due from banks 7,649 8,105 6,645 5,145 3,953
Federal funds sold and securities under resale agreements 10,592 10,998 9,782 13,257 10,633
Trading assets 10,681 5,587 7,952 6,561 5,157
Derivative product assets 3,278 3,207 3,372 3,746 4,270
Investment securities 38,288 47,459 47,912 47,971 45,197
Loans
Commercial 101,813 98,099 96,352 93,183 89,723
Consumer 66,306 65,087 63,488 58,944 59,613
Credit Card 4,472 4,892 4,037 6,016 8,128
---------------------------------------------------------
Total loans 172,591 168,078 163,877 158,143 157,464
Allowance for credit losses (2,983) (2,338) (2,285) (2,252) (2,250)
---------------------------------------------------------
Loans, net 169,608 165,740 161,592 155,891 155,214
Other assets:
Bank premises and equipment, net 3,073 3,266 3,317 3,279 3,253
Other 13,070 13,379 12,777 12,960 13,020
---------------------------------------------------------
Total other assets 16,143 16,645 16,094 16,239 16,273
---------------------------------------------------------
Total assets $272,709 $273,008 $269,425 $264,135 $256,033
=========================================================
Liabilities
Deposits
Demand $ 29,055 $ 29,923 $ 31,194 $ 29,979 $ 33,881
Savings 63,722 65,292 64,435 65,906 64,511
Time 43,170 40,263 36,877 35,136 33,613
Foreign offices 27,222 29,165 29,772 25,879 24,449
---------------------------------------------------------
Total deposits 163,169 164,643 162,278 156,900 156,454
Federal funds purchased and repurchase agreements 17,610 18,451 18,720 20,493 19,710
Other short-term borrowings 21,827 18,261 21,211 19,405 16,649
Long-term borrowings 37,515 37,175 33,857 33,157 26,725
Guaranteed preferred beneficial interest in the
Corporation's junior subordinated debt 1,578 1,578 1,578 1,578 1,003
Derivative product liabilities 3,201 3,100 3,332 3,902 4,619
Other liabilities 8,989 9,529 8,359 8,650 9,823
---------------------------------------------------------
Total liabilities 253,889 252,737 249,335 244,085 234,983
---------------------------------------------------------
Stockholders' Equity
Preferred stock 190 190 190 190 190
Common stock 12 12 12 12 12
Surplus 10,605 10,679 10,799 10,740 10,762
Retained earnings 9,484 11,242 11,037 11,099 10,673
Accumulated other adjustments to stockholders' equity (135) (358) (263) (258) (146)
Deferred compensation (156) (165) (118) (128) (137)
Treasury stock (1,180) (1,329) (1,567) (1,605) (304)
---------------------------------------------------------
Total stockholders' equity 18,820 20,271 20,090 20,050 21,050
---------------------------------------------------------
Total liabilities and stockholders' equity $272,709 $273,008 $269,425 $264,135 $256,033
=========================================================
Common Shares -- period-end (millions)
Common shares issued 1,181 1,181 1,182 1,182 1,182
Treasury shares 26 29 35 35 5
--------------------------------------------------------
Common shares outstanding 1,155 1,152 1,147 1,147 1,177
=========================================================
</TABLE>
15
<PAGE>
BANK ONE CORPORATION and Subsidiaries
<TABLE>
<CAPTION>
Second Quarter 2000 First Quarter 2000 Fourth Quarter 1999
Average Balance Sheet, Yields, & Rates ---------------------------- ---------------------------- ----------------------------
Managed (1) Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
($ millions) Balance Expense Rate Balance Expense Rate Balance Expense Rate
-------------------------------------- -------- ------- ------ -------- ------- ------ -------- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets
Short-term investments $ 17,356 $ 276 6.40% $ 15,451 $ 226 5.88% $ 15,985 $ 215 5.34%
Trading assets (2) 6,442 100 6.24 6,909 100 5.82 6,614 99 5.94
Investment securities: (2)
U.S. government and federal agency 15,074 260 6.94 15,641 258 6.63 15,046 257 6.78
States and political subdivisions 1,398 27 7.77 1,483 28 7.59 1,646 30 7.23
Other 12,516 167 5.37 12,482 165 5.32 14,666 188 5.09
------------------- ------------------- -------------------
Total investment securities 28,988 454 6.30 29,606 451 6.13 31,358 475 6.01
Loans (2) (3)
Commercial 100,146 2,133 8.57 97,973 1,941 7.97 93,491 1,862 7.90
Consumer 65,527 1,455 8.93 65,118 1,493 9.22 62,577 1,334 8.46
Credit Card 66,148 2,449 14.89 67,095 2,499 14.98 68,678 2,570 14.85
------------------- ------------------- -------------------
Total loans, net 231,821 6,037 10.47 230,186 5,933 10.37 224,746 5,766 10.18
Total earning assets 284,607 6,867 9.70 282,152 6,710 9.56 278,703 6,555 9.33
Allowance for credit losses (2,531) (2,367) (2,294)
Other assets - nonearning 34,528 33,772 34,939
-------- -------- --------
Total assets $316,604 $313,557 $311,348
======== ======== ========
Liabilities and Stockholders' Equity
Deposits--interest-bearing
Savings $ 16,973 $ 60 1.42 $ 16,942 $ 61 1.45 $ 18,955 $ 70 1.47
Money market 48,450 410 3.40 47,606 400 3.38 46,066 379 3.26
Time 41,946 609 5.84 38,818 550 5.70 36,083 481 5.29
Foreign offices 28,848 408 5.69 29,443 378 5.16 27,292 338 4.91
------------------- ------------------- -------------------
Total deposits--interest-bearing 136,217 1,487 4.39 132,809 1,389 4.21 128,396 1,268 3.92
Federal funds purchased and securities
under repurchase agreements 18,632 281 6.07 19,316 266 5.54 19,126 245 5.08
Other short-term borrowings 63,029 1,033 6.59 64,751 1,003 6.23 65,873 995 5.99
Long-term debt 38,642 670 6.97 36,484 607 6.69 35,672 550 6.12
------------------- ------------------- -------------------
Total interest-bearing liabilities 256,520 3,471 5.44 253,360 3,265 5.18 249,067 3,058 4.87
Demand deposits 27,692 27,921 29,223
Other liabilities 12,503 12,305 13,051
Preferred stock 190 190 190
Common stockholders' equity 19,699 19,781 19,817
-------- -------- --------
Total liabilities and equity $316,604 $313,557 $311,348
======== ======== ========
Interest income/earning assets $ 6,867 9.70% $ 6,710 9.56% $ 6,555 9.33%
Interest expense/earning assets 3,471 4.90 3,265 4.65 3,058 4.35
---------------- ---------------- ----------------
Net interest margin $ 3,396 4.80% $ 3,445 4.91% $ 3,497 4.98%
================ ================ ================
</TABLE>
(1) Managed data adjusted for credit card securitization activity.
(2) Includes tax-equivalent adjustments based on a 35% federal income tax rate.
(3) Nonperforming loans are included in balances used to determine the average
rate.
16
<PAGE>
BANK ONE CORPORATION and Subsidiaries
<TABLE>
<CAPTION>
Third Quarter 1999 Second Quarter 1999
Average Balance Sheet, Yields, & Rates --------------------------------- -------------------------------
Managed (1) Average Income/ Yield/ Average Income/ Yield/
($ millions) Balance Expense Rate Balance Expense Rate
------------------------------------------- ----------- ---------- --------- ----------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Assets
Short-term investments $ 13,164 $ 159 4.79% $ 12,602 $ 142 4.52%
Trading assets (2) 6,185 84 5.39 6,046 76 5.04
Investment securities: (2)
U.S. government and federal agency 15,111 247 6.48 15,395 259 6.75
States and political subdivisions 1,765 32 7.19 1,909 34 7.14
Other 13,839 172 4.93 13,613 155 4.57
------------------ -------------------
Total investment securities 30,715 451 5.83 30,917 448 5.81
Loans (2) (3)
Commercial 91,186 1,719 7.48 88,911 1,649 7.44
Consumer 59,876 1,285 8.51 58,065 1,240 8.57
Credit Card 69,153 2,661 15.27 68,947 2,646 15.39
------------------ -------------------
Total loans, net 220,215 5,665 10.21 215,923 5,535 10.28
Total earning assets 270,279 6,359 9.33 265,488 6,201 9.37
Allowance for credit losses (2,283) (2,260)
Other assets - nonearning 33,721 35,021
--------- ---------
Total assets $301,717 $298,249
========= =========
Liabilities and Stockholders' Equity
Deposits -- interest-bearing
Savings $ 19,705 $ 74 1.49 $ 20,843 $ 83 1.60
Money market 46,526 367 3.13 42,903 343 3.21
Time 34,842 425 4.84 34,097 428 5.03
Foreign offices 25,350 296 4.63 22,548 245 4.36
------------------ -------------------
Total deposits -- interest-bearing 126,423 1,162 3.65 120,391 1,099 3.66
Federal funds purchased and securities
under repurchase agreements 17,557 213 4.81 20,354 231 4.55
Other short-term borrowings 64,411 901 5.55 62,638 811 5.21
Long-term debt 31,326 460 5.83 26,417 385 5.85
------------------ -------------------
Total interest-bearing liabilities 239,717 2,736 4.53 229,800 2,526 4.42
Demand deposits 29,189 32,924
Other liabilities 12,479 14,591
Preferred stock 190 190
Common stockholders' equity 20,142 20,744
-------- --------
Total liabilities and equity $301,717 $298,249
======== ========
Interest income/earning assets $6,359 9.33% $6,201 9.37%
Interest expense/earning assets 2,736 4.02 2,526 3.82
----------------- -----------------
Net interest margin $3,623 5.32% $3,675 5.55%
================= =================
</TABLE>
(1) Managed data adjusted for credit card securitization activity.
(2) Includes tax-equivalent adjustments based on a 35% federal income tax rate.
(3) Nonperforming loans are included in balances used to determine the average
rate.
17
<PAGE>
<TABLE>
<CAPTION>
BANK ONE CORPORATION and Subsidiaries
Six Months Ended
---------------------------------------------------------------------------
Average Balance Sheet, Yields, & Rates June 30, 2000 June 30, 1999
---------------------------------- ---------------------------------
Managed (1) Average Income Yield/ Average Income Yield/
($ millions) Balance Expense Rate Balance Expense Rate
-------------------------------------- ------- ------- ------ ------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
Short-term investments $ 16,404 $ 502 6.15% $ 13,367 $ 304 4.59%
Trading assets (1) 6,676 200 6.02 5,852 150 5.17
Investment securities: (1)
U.S. government and federal agency 15,357 518 6.78 15,380 504 6.61
States and political subdivisions 1,440 55 7.68 1,966 73 7.49
Other (2) 12,500 332 5.34 12,671 297 4.73
--------------------- ---------------------
Total investment securities 29,297 905 6.21 30,017 874 5.87
Loans (1) (3)
Commercial 99,059 4,074 8.27 87,990 3,231 7.40
Consumer 65,323 2,948 9.08 57,623 2,522 8.83
Credit card (2) 66,621 4,948 14.94 69,046 5,299 15.48
--------------------- ---------------------
Total loans, net 231,003 11,970 10.42 214,659 11,052 10.38
Total earning assets 283,380 13,577 9.63 263,895 12,380 9.46
Allowance for credit losses (2,449) (2,292)
Other assets - nonearning 34,149 36,173
-------- --------
Total assets $315,080 $297,776
======== ========
Deposits -- interest-bearing
Savings $ 16,957 $ 121 1.43 $ 20,411 $ 166 1.64
Money market 48,028 810 3.39 43,139 699 3.27
Time 40,382 1,159 5.77 34,937 878 5.07
Foreign offices 29,146 786 5.42 21,956 478 4.39
--------------------- ---------------------
Total deposits -- interest-bearing 134,513 2,876 4.30 120,443 2,221 3.72
Federal funds purchased and securities
under repurchase agreements 18,974 547 5.80 21,104 477 4.56
Other short-term borrowings 63,890 2,036 6.41 61,941 1,611 5.24
Long-term debt 37,563 1,277 6.84 25,167 735 5.89
--------------------- ---------------------
Total interest-bearing liabilities 254,940 6,736 5.31 228,655 5,044 4.45
Demand deposits 27,806 33,287
Other liabilities 12,404 15,091
Preferred stock 190 190
Common stockholders' equity 19,740 20,553
-------- --------
Total liabilities and equity $315,080 $297,776
======== ========
Interest income/earning assets $13,577 9.63% $12,380 9.46%
Interest expense/earning assets 6,736 4.78 5,044 3.85
-------------------- ------------------
Net interest margin $ 6,841 4.85% $ 7,336 5.61%
==================== ==================
</TABLE>
(1) Managed data adjusted for credit card securitization activity.
(2) Includes tax-equivalent adjustments based on a 35% federal income tax rate.
(3) Nonperforming loans are included in balances used to determine the average
rate.
18
<PAGE>
<TABLE>
<CAPTION>
BANK ONE CORPORATION and Subsidiaries
Second Quarter 2000 First Quarter 2000
Average Balance Sheet, Yields, & Rates ------------------------------ -------------------------------
Reported Average Income/ Yield/ Average Income/ Yield/
($ millions) Balance Expense Rate Balance Expense Rate
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets
Short-term investments $ 17,356 $ 276 6.40% $ 15,451 $ 226 5.88%
Trading assets (1) 6,442 100 6.24 6,909 100 5.82
Investment securities: (1)
U.S. government and federal agency 15,074 260 6.94 15,641 258 6.63
States and political subdivisions 1,398 27 7.77 1,483 28 7.59
Other 29,813 575 7.76 30,406 564 7.46
------------------- ---------------------
Total investment securities 46,285 862 7.49 47,530 850 7.19
Loans (1) (2)
Commercial 100,146 2,133 8.57 97,973 1,941 7.97
Consumer 65,527 1,455 8.93 65,118 1,493 9.22
Credit Card 5,070 176 13.96 4,332 178 16.53
------------------- ---------------------
Total loans, net 170,743 3,764 8.87 167,423 3,612 8.68
Total earning assets 240,826 5,002 8.35 237,313 4,788 8.11
Allowance for credit losses (2,531) (2,367)
Other assets - nonearning 34,528 33,772
-------- --------
Total assets $272,823 $268,718
======== ========
Liabilities and Stockholders' Equity
Deposits -- interest-bearing
Savings $ 16,973 $ 60 1.42 $ 16,942 $ 61 1.45
Money market 48,450 410 3.40 47,606 400 3.38
Time 41,946 609 5.84 38,818 550 5.70
Foreign offices 28,848 408 5.69 29,443 378 5.16
------------------- ---------------------
Total deposits -- interest-bearing 136,217 1,487 4.39 132,809 1,389 4.21
Federal funds purchased and securities
under repurchase agreements 18,632 281 6.07 19,316 266 5.54
Other short-term borrowings 19,248 307 6.41 19,912 298 6.02
Long-term debt 38,642 670 6.97 36,484 607 6.69
------------------- ---------------------
Total interest-bearing liabilities 212,739 2,745 5.19 208,521 2,560 4.94
Demand deposits 27,692 27,921
Other liabilities 12,503 12,305
Preferred stock 190 190
Common stockholders' equity 19,699 19,781
-------- --------
Total liabilities and equity $272,823 $268,718
======== ========
Interest income/earning assets $5,002 8.35% $4,788 8.11%
Interest expense/earning assets 2,745 4.58 2,560 4.33
------------------ -----------------
Net interest margin $2,257 3.77% $2,228 3.78%
================== =================
</TABLE>
<TABLE>
<CAPTION>
Fourth Quarter 1999
Average Balance Sheet, Yields, & Rates -------------------------------
Reported Average Income/ Yield/
($ millions) Balance Expense Rate
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Assets
Short-term investments $ 15,985 $ 215 5.34%
Trading assets (1) 6,614 99 5.94
Investment securities: (1)
U.S. government and federal agency 15,046 257 6.78
States and political subdivisions 1,646 30 7.23
Other 32,495 600 7.33
-------------------
Total investment securities 49,187 887 7.15
Loans (1) (2)
Commercial 93,491 1,862 7.90
Consumer 62,577 1,334 8.46
Credit Card 4,526 184 16.13
-------------------
Total loans, net 160,594 3,380 8.35
Total earning assets 232,380 4,581 7.82
Allowance for credit losses (2,294)
Other assets - nonearning 34,939
--------
Total assets $265,025
========
Liabilities and Stockholders' Equity
Deposits -- interest-bearing
Savings $ 18,955 $ 70 1.47
Money market 46,066 379 3.26
Time 36,083 481 5.29
Foreign offices 27,292 338 4.91
-------------------
Total deposits -- interest-bearing 128,396 1,268 3.92
Federal funds purchased and securities
under repurchase agreements 19,126 245 5.08
Other short-term borrowings 19,550 297 6.03
Long-term debt 35,672 550 6.12
-------------------
Total interest-bearing liabilities 202,744 2,360 4.62
Demand deposits 29,223
Other liabilities 13,051
Preferred stock 190
Common stockholders' equity 19,817
--------
Total liabilities and equity $265,025
========
Interest income/earning assets $4,581 7.82%
Interest expense/earning assets 2,360 4.03
-----------------
Net interest margin $2,221 3.79%
=================
</TABLE>
(1) Includes tax-equivalent adjustments based on a 35% federal income tax rate.
(2) Nonperforming loans are included in balances used to determine the average
rate.
19
<PAGE>
<TABLE>
<CAPTION>
BANK ONE CORPORATION and Subsidiaries
Average Balance Sheet, Yields, & Rates Third Quarter 1999 Second Quarter 1999
------------------------------- -------------------------------
Reported Average Income/ Yield/ Average Income/ Yield/
($ millions) Balance Expense Rate Balance Expense Rate
-------------------------------------- ------- ------- ------ ------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
Assets
Short-term investments $ 13,164 $ 159 4.79% $ 12,602 $ 142 4.52%
Trading assets (1) 6,185 84 5.39 6,046 76 5.04
Investment securities: (1)
U.S. government and federal agency 15,111 247 6.48 15,395 259 6.75
States and political subdivisions 1,765 32 7.19 1,909 34 7.14
Other 29,013 541 7.40 29,057 522 7.21
-------------------- --------------------
Total investment securities 45,889 820 7.09 46,361 815 7.05
Loans (1) (2)
Commercial 91,186 1,719 7.48 88,911 1,649 7.44
Consumer 59,876 1,285 8.51 58,065 1,240 8.57
Credit Card 6,905 276 15.86 8,520 344 16.19
-------------------- --------------------
Total loans, net 157,967 3,280 8.24 155,496 3,233 8.34
Total earning assets 223,205 4,343 7.72 220,505 4,266 7.76
Allowance for credit losses (2,283) (2,260)
Other assets - nonearning 33,721 35,021
-------- --------
Total assets $254,643 $253,266
======== ========
Liabilities and Stockholders' Equity
Deposits -- interest-bearing
Savings $ 19,705 $ 74 1.49 20,843 $ 83 1.60
Money market 46,526 367 3.13 42,903 343 3.21
Time 34,842 425 4.84 34,097 428 5.03
Foreign offices 25,350 296 4.63 22,548 245 4.36
-------------------- --------------------
Total deposits -- interest-bearing 126,423 1,162 3.65 120,391 1,099 3.66
Federal funds purchased and securities
under repurchase agreements 17,557 213 4.81 20,354 231 4.55
Other short-term borrowings 17,337 237 5.42 17,655 210 4.77
Long-term debt 31,326 460 5.83 26,417 385 5.85
-------------------- --------------------
Total interest-bearing liabilities 192,643 2,072 4.27 184,817 1,925 4.18
Demand deposits 29,189 32,924
Other liabilities 12,479 14,591
Preferred stock 190 190
Common stockholders' equity 20,142 20,744
-------- --------
Total liabilities and equity $254,643 $253,266
======== ========
Interest income/earning assets $4,343 7.72% $4,266 7.76%
Interest expense/earning assets 2,072 3.68 1,925 3.50
----------------- ------------------
Net interest margin $2,271 4.04% $2,341 4.26%
================= ==================
</TABLE>
(1) Includes tax-equivalent adjustments based on a 35% federal income tax rate.
(2) Nonperforming loans are included in balances used to determine the average
rate.
20
<PAGE>
BANK ONE CORPORATION and Subsidiaries
<TABLE>
<CAPTION>
Average Balance Sheet, Yields, & Rates Six Months Ended
----------------------------------------------------------------------
Reported June 30, 2000 June 30, 1999
-------------------------------- --------------------------------
Average Income Yield/ Average Income Yield/
($ millions) Balance Expense Rate Balance Expense Rate
---------------------------------------------- ------- ------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Short-term investments $ 16,404 $ 502 6.15% $ 13,367 $ 304 4.59%
Trading assets (1) 6,676 200 6.02 5,852 150 5.17
Investment securities: (1)
U.S. government and federal agency 15,357 518 6.78 15,380 504 6.61
States and political subdivisions 1,440 55 7.68 1,966 73 7.49
Other (2) 30,110 1,139 7.61 28,259 1,027 7.33
--------------------- ---------------------
Total investment securities 46,907 1,712 7.34 45,605 1,604 7.09
Loans (1) (3)
Commercial 99,059 4,074 8.27 87,990 3,231 7.40
Consumer 65,323 2,948 9.08 57,623 2,522 8.83
Credit card (2) 4,701 354 15.14 8,777 680 15.62
--------------------- ---------------------
Total loans, net 169,083 7,376 8.77 154,390 6,433 8.40
Total earning assets 239,070 9,790 8.24 219,214 8,491 7.81
Allowance for credit losses (2,449) (2,292)
Other assets - nonearning 34,149 36,173
-------- --------
Total assets $270,770 $253,095
======== ========
Deposits -- interest-bearing
Savings $ 16,957 $ 121 1.43 $ 20,411 $ 166 1.64
Money market 48,028 810 3.39 43,139 699 3.27
Time 40,382 1,159 5.77 34,937 878 5.07
Foreign offices 29,146 786 5.42 21,956 478 4.39
--------------------- ---------------------
Total deposits -- interest-bearing 134,513 2,876 4.30 120,443 2,221 3.72
Federal funds purchased and securities
under repurchase agreements 18,974 547 5.80 21,104 477 4.56
Other short-term borrowings 19,580 605 6.21 17,260 408 4.77
Long-term debt 37,563 1,277 6.84 25,167 735 5.89
--------------------- ---------------------
Total interest-bearing liabilities 210,630 5,305 5.06 183,974 3,841 4.21
Demand deposits 27,806 33,287
Other liabilities 12,404 15,091
Preferred stock 190 190
Common stockholders' equity 19,740 20,553
-------- --------
Total liabilities and equity $270,770 $253,095
======== ========
Interest income/earning assets $ 9,790 8.24% $ 8,491 7.81%
Interest expense/earning assets 5,305 4.47 3,841 3.53
------------------- -------------------
Net interest margin $ 4,485 3.77% $ 4,650 4.28%
=================== ===================
</TABLE>
(1) Includes tax-equivalent adjustments based on a 35% federal income tax rate.
(2) Nonperforming loans are included in balances used to determine the average
rate.
21
<PAGE>
<TABLE>
<CAPTION>
BANK ONE CORPORATION and Subsidiaries
Three Months Ended
-------------------------------------------------------------
Credit Quality Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
($ millions) 2000 2000 1999 1999 1999
---------------------------------------------------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Provision for credit losses $1,013 $ 362 $ 416 $ 277 $ 275
Gross charge-offs $ 383 $ 338 $ 468 $ 342 $ 354
Recoveries 64 72 85 75 79
-------------------------------------------------------------
Net charge-offs $ 319 $ 266 $ 383 $ 267 $ 275
Net charge-offs
Commercial $ 117 $ 84 $ 71 $ 91 $ 81
Consumer 135 123 256 93 89
Credit card 67 59 56 83 105
-------------------------------------------------------------
Total net charge-offs $ 319 $ 266 $ 383 $ 267 $ 275
Credit card net charge-offs -- managed $ 900 $ 969 $1,119 $ 921 $ 905
Net charge-off ratios
Commercial 0.47% 0.34% 0.30% 0.40% 0.36%
Consumer 0.82 0.76 1.64 0.62 0.61
Credit card 5.29 5.45 4.95 4.81 4.93
Total net charge-off ratio 0.75 0.64 0.95 0.68 0.71
Total net charge-off ratio -- managed 1.99 2.04 2.57 2.01 1.99
Credit card net charge-off ratio-- managed 5.44 5.78 6.52 5.33 5.25
Allowance for credit losses -- period-end $2,983 $2,338 $2,285 $2,252 $2,250
Nonperforming assets -- period-end
Nonperforming loans $1,690 $1,564 $1,559 $1,569 $1,519
Other, including other real estate owned 94 97 106 113 105
-------------------------------------------------------------
Total nonperforming assets $1,784 $1,661 $1,665 $1,682 $1,624
Allowance to ending loans 1.73% 1.39% 1.39% 1.42% 1.43%
Allowance to nonperforming loans 177 149 147 144 148
Nonperforming assets ratio 1.03 0.99 1.02 1.06 1.03
Credit card delinquency rate - managed
30+ days 3.83% 4.08% 4.57% 4.74% 4.30%
90+ days 1.69% 1.91% 2.13% 2.07% 1.96%
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
BANK ONE CORPORATION and Subsidiaries
Capital and Related Information Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
($ millions, except per-share amounts) 2000 2000 1999 1999 1999
----------------------------------------------- --------- --------- --------- --------- ---------
Common equity/ managed assets ratio 5.9% 6.3% 6.3% 6.4% 6.9%
Tangible common equity / tangible managed assets 5.4 5.7 5.7 5.7 6.2
Tier 1 capital ratio 7.1 7.7 7.7 7.7 8.1
Total risk adjusted capital ratio 10.2 10.6 10.7 10.8 11.4
Regulatory leverage ratio 7.0 7.7 7.7 7.9 8.1
Book value of common equity per share $ 16.12 $ 17.43 $ 17.34 $ 17.32 $ 17.73
Regulatory Risk Weighted Assets (1)
-----------------------------------
Tier 1 capital $ 19,122 $ 20,573 $ 20,247 $ 20,128 $ 20,423
Tier 2 capital 8,400 7,899 7,967 7,991 8,398
-------------------------------------------------------------
Total capital $ 27,522 $ 28,472 $ 28,214 $ 28,119 $ 28,821
Total risk weighted assets $ 269,249 $ 268,339 $ 263,169 $ 259,747 $ 252,390
(1) Estimate
Intangible Assets
-----------------
Goodwill $ 894 $ 916 $ 934 $ 955 $ 973
Other nonqualifying intangibles 435 637 669 723 722
-------------------------------------------------------------
Subtotal $ 1,329 $ 1,553 $ 1,603 $ 1,678 $ 1,695
Qualifying intangibles 257 555 583 592 618
-------------------------------------------------------------
Total $ 1,586 $ 2,108 $ 2,186 $ 2,270 $ 2,313
Managed Income Statement Statistics(1)
($ millions)
-----------------------------------------------
Net interest income -- FTE $ 3,396 $ 3,445 $ 3,497 $ 3,624 $ 3,675
Provision for credit losses 1,846 1,272 1,296 1,115 1,075
Credit card revenue 171 271 318 382 339
Other noninterest income (189) 1,243 1,068 1,201 1,349
Noninterest expense 3,507 2,661 3,030 2,713 2,806
Net income (1,269) 689 411 925 992
</TABLE>
23
<PAGE>
BANK ONE CORPORATION LINE OF BUSINESS DETAIL*
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended Jun 30, 2000
------------------------------------------------------ -------------------------------
Income Statement ($ millions) Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Chg Prior Yr. Chg. Prior Qtr
Balance Sheet ($ billions) 2000 2000 1999 1999 1999 1999 Amt % Amt %
------- ------ ------ ------ ------ ------ ----- --- ----- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Retail (incld. Wingspan)
----------------------------
Net interest income FTE $ 1,205 $1,236 $ 1,118 $ 1,100 $ 1,082 $ 1,079 $ 123 11% $ (31) -3%
Provision 121 167 116 83 83 133 38 46% (46) -28%
Noninterest income 330 306 339 395 408 399 (78) -19% 24 8%
Noninterest expense 1,024 1,002 995 1,000 962 976 62 6% 22 2%
------- ------ ------- ------- ------- ------- ----- ------
Pretax income (FTE) 390 373 346 412 445 369 (55) -12% 17 5%
Taxes & FTE adj 143 137 110 144 155 122 (12) -8% 6 4%
------- ------ ------- ------- ------- ------- ----- ------
Net Income - adjusted 247 236 236 268 290 247 (43) -15% 11 5%
Significant items- 2Q00 (328) 0 0 0 0 0 (328) nm (328) nm
------- ------ ------- ------- ------- ------- ----- ------
Net income - reported (81) 236 236 268 290 247 (371) -128% (317) -134%
Return on equity ** 17% 18% 20% 23% 25% 22% -8% -1%
Efficiency ratio ** 67% 65% 68% 67% 65% 66% 2% 2%
** Net income - adjusted
Loans - avg $ 73.6 $ 73.1 $ 68.8 $ 66.9 $ 64.9 $ 63.9 $ 8.7 13% $ 0.5 1%
Assets - avg 77.9 79.6 74.9 73.4 71.4 70.4 6.5 9% (1.7) -2%
Deposits - avg 89.4 88.3 87.6 88.5 89.2 90.9 0.2 0% 1.1 1%
Common equity - avg 5.9 5.3 4.6 4.7 4.6 4.5 1.3 28% 0.6 11%
Supplemental Information:
-------------------------
Commercial loans - avg $ 11.8 $ 11.5 $ 11.6 $ 10.9 $ 10.8 $ 10.5 $ 1.0 9% $ 0.3 3%
Indirect auto loans/leases - avg 24.4 24.3 24.0 23.5 23.2 22.9 1.2 5% 0.1 0%
Home equity loans - avg 26.3 25.5 23.4 20.6 18.9 17.5 7.4 39% 0.8 3%
Other personal loans - avg 11.1 11.8 9.8 11.9 12.0 13.0 (0.9) -8% (0.7) -6%
Total loans $ 73.6 $ 73.1 $ 68.8 $ 66.9 $ 64.9 $ 63.9 $ 8.7 13% $ 0.5 1%
Distribution
------------
# Banking centers 1,832 1,839 1,854 1,884 1,919 1,955 (87) -5% (7) 0%
# ATMs 6,530 6,651 6,824 7,088 7,372 8,007 (842) -11% (121) -2%
# on-line customers (000s) 690.2 589.5 488.4 439.9 325.9 306.1 364.3 112% 100.7 17%
Investments
-----------
IMG sales volume ($ millions) $ 1,105 $1,193 $ 959 $ 969 $ 1,223 $ 926 $ (118) -10% $ (88) -7%
</TABLE>
NOTE: Certain balance sheet breakdowns (i.e. loans, deposits) are based on line-
of-business definitions and as a result would not necessarily agree to
consolidated financial information which is based on a regulatory reporting
definitional framework
*2Q00 adjusted for one-time items; FUSA on managed basis.
See 3/17/00 Form 10-K for definitions and methodologies.
24
<PAGE>
BANK ONE CORPORATION LINE OF BUSINESS DETAIL*
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended Jun 30, 2000
--------------------------------------------------- -------------------------------
Income Statement ($ millions) Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Chg Prior Yr. Chg. Prior Qtr
Balance Sheet ($ billions) 2000 2000 1999 1999 1999 1999 Amt % Amt %
------ ------ ------ ------ ------ ------ --- --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Commercial Banking
------------------------------
Net interest income FTE $ 694 $ 664 $ 672 $ 636 $ 628 $ 602 $ 66 11% $ 30 5%
Provision 150 132 113 109 108 105 42 39% 18 14%
Noninterest income 356 354 316 285 329 351 27 8% 2 1%
Noninterest expense 563 570 582 507 538 568 25 5% (7) -1%
------ ------ ------ ------ ------ ------ ------ -----
Pretax income (FTE) 337 316 293 305 311 280 26 8% 21 7%
Taxes & FTE adj 123 116 94 107 108 92 15 14% 7 6%
------ ------ ------ ------ ------ ------ ------ -----
Net Income - adjusted 214 200 199 198 203 188 11 5% 14 7%
Significant items- 2Q00 (427) 0 0 0 0 0 (427) nm (427) nm
------ ------ ------ ------ ------ ------ ------ -----
Net income - reported (213) 200 199 198 203 188 (416) -205% (413) -207%
Return on equity ** 13% 13% 14% 14% 14% 13% -1% 0%
Efficiency ratio ** 54% 56% 59% 55% 56% 60% -2% -2%
** Net income - adjusted
Loans - avg $ 82.1 $ 80.4 $ 78.0 $ 74.9 $ 73.0 $ 71.5 $ 9.1 12% $ 1.7 2%
Assets - avg 110.2 110.2 109.9 104.4 104.4 104.9 5.8 6% 0.0 0%
Deposits - avg 40.9 39.2 38.9 37.3 37.4 37.2 3.5 9% 1.7 4%
Common equity - avg 6.7 6.2 5.6 5.7 5.8 5.7 0.9 16% 0.5 8%
Supplemental Information:
Middle Market:
--------------
Loans - avg $ 31.9 $ 31.0 $ 30.2 $ 29.8 $ 28.6 $ 27.5 $ 3.3 12% $ 0.9 3%
Deposits - avg $ 18.4 $ 18.3 $ 18.7 $ 18.7 $ 18.5 $ 18.6 $ (0.1) -1% $ 0.1 1%
Corporate Banking
-----------------
Loans - avg $ 38.1 $ 37.2 $ 35.8 $ 33.0 $ 31.9 $ 31.6 $ 6.2 19% $ 0.9 2%
Deposits - avg $ 11.9 $ 11.3 $ 10.2 $ 9.6 $ 9.9 $ 9.2 $ 2.0 20% $ 0.6 5%
Syndications ***
Volume ($ billions) $ 18.4 $ 9.6 $ 16.2 $ 13.2 $ 9.6 $ 8.9 $ 8.8 92% $ 8.8 92%
# syndications - lead arranger 67 35 66 42 41 41 26 63% 32 91%
*** Quarters do not sum to full year due to timing of deals reported
Real Estate
-----------
Loans - avg $ 12.0 $ 11.9 $ 11.6 $ 11.1 $ 11.0 $ 10.8 $ 1.0 9% $ 0.1 1%
Deposits - avg $ 1.5 $ 1.5 $ 1.5 $ 1.5 $ 1.5 $ 1.5 $ - 0% $ - 0%
</TABLE>
*2Q00 adjusted for one-time items; FUSA on managed basis.
See 3/17/00 Form 10-K for definitions and methodologies.
25
<PAGE>
BANK ONE CORPORATION LINE OF BUSINESS DETAIL*
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended Jun 30, 2000
--------------------------------------------------------- ------------------------------------
Income Statement ($ millions) Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Chg Prior Yr. Chg. Prior Qtr
Balance Sheet ($ billions) 2000 2000 1999 1999 1999 1999 Amt % Amt %
------- ------- ------- ------- ------- ------- -------- ---- ------ -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First USA
-------------------------------
Net interest income FTE $ 1,451 $ 1,525 $ 1,570 $ 1,733 $ 1,781 $ 1,797 $ (330) -19% $ (74) -5%
Provision 900 969 933 922 898 840 2 0% (69) -7%
FAS 125 gains (30) (41) (26) 12 50 25 (80) -160% 11 27%
** Excludes charges in excess ** **
of normal run rate
Other noninterest income 337 305 445 398 405 323 (68) -17% 32 10%
------- ------- ------- ------- ------- ------- --------- ------
Noninterest income 307 264 419 410 455 348 (148) -33% 43 16%
Noninterest expense 679 715 754 778 818 854 (139) -17% (36) -5%
------- ------- ------- ------- ------- ------- --------- ------
Pretax income (FTE) 179 105 302 443 520 451 (341) -66% 74 70%
Taxes & FTE adj 66 38 96 155 181 149 (115) -64% 28 74%
------- ------- ------- ------- ------- ------- --------- ------
Net Income - adjusted 113 67 206 288 339 302 (226) -67% 46 69%
Significant items - 2Q00 (492) 0 0 0 0 0 (492) nm (492) nm
------- ------- ------- ------- ------- ------- --------- ------
Net income - reported (379) 67 206 288 339 302 (718) -212% (446) -666%
Return on O/S (ROO) pretax *** 1.1% 0.6% 1.7% 2.5% 3.0% 2.7% -1.9% 0.5%
Return on equity *** 7% 4% 14% 19% 23% 20% -16% 3%
Efficiency ratio *** 39% 40% 38% 36% 37% 40% 2% -1%
*** Net income - adjusted
Loans - avg $ 66.3 $ 67.1 $ 68.7 $ 69.2 $ 68.9 $ 69.1 $ (2.8) -4% $ (1.0) -1%
Assets - avg 70.6 72.8 74.9 75.0 75.0 74.8 (4.4) -6% (2.2) -3%
Common equity - avg 6.1 6.2 6.0 6.1 6.0 6.0 0.1 2% (0.1) -2%
Supplemental Information:
-------------------------------
% of Avg. Outstandings *
------------------------
Net interest income FTE 8.83% 9.14% 9.07% 9.94% 10.37% 10.55% -1.54% -0.31%
Provision 5.44% 5.78% 5.39% 5.33% 5.23% 4.93% 0.21% -0.34%
Noninterest income 1.87% 1.58% 2.42% 2.35% 2.65% 2.04% -0.78% 0.29%
Noninterest expense 4.13% 4.29% 4.35% 4.46% 4.76% 5.01% -0.63% -0.16%
Pretax income FTE 1.09% 0.63% 1.74% 2.54% 3.03% 2.65% -1.94% 0.46%
Net income 0.69% 0.40% 1.19% 1.65% 1.97% 1.77% -1.28% 0.29%
Credit card loans - eop
-------------------------
Managed credit card loans $ 66.3 $ 66.5 $ 69.4 $ 70.0 $ 69.5 $ 68.4 $ (3.2) -5% $ (0.2) 0%
Managed charge-offs-$ $ 900 $ 969 $ 1,119 $ 921 $ 905 $ 845 $ (5) -1% $ (69) -7%
Managed charge-offs-ratio 5.44% 5.78% 6.52% 5.33% 5.25% 4.89% 0.19% -0.34%
Delinquency ratio - 30+ days 3.83% 4.08% 4.57% 4.74% 4.30% 4.51% -0.47% -0.25%
Delinquency ratio - 90+ days 1.69% 1.91% 2.13% 2.07% 1.96% 2.06% -0.27% -0.22%
Charge volume ($ mill) $ 36.8 $ 34.0 $ 37.5 $ 36.1 $ 35.6 $ 33.5 $ 1.2 3% $ 2.8 8%
New accounts opened (000s) 826 950 1,076 1,835 2,287 2,910 (1,461) -64% (124) -13%
Cards issued (000s) 54,648 56,378 64,191 64,523 65,620 64,863 (10,972) -17% (1,730) -3%
</TABLE>
*2Q00 adjusted for one-time items; FUSA on managed basis.
See 3/17/00 Form 10-K for definitions and methodologies.
26
<PAGE>
BANK ONE CORPORATION LINE OF BUSINESS DETAIL*
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended Jun 30, 2000
-------------------------------------------------------- -------------------------------
Income Statement ($ millions) Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Chg Prior Yr. Chg. Prior Qtr
Balance Sheet ($ billions) 2000 2000 1999 1999 1999 1999 Amt % Amt %
------ ------ ------ ------ ------ ------ ----- --- ----- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Investment Management
---------------------
Net interest income FTE $ 101 $ 100 $ 91 $ 93 $ 99 $ 93 $ 2 2% $ 1 1%
Provision 2 2 1 1 0 0 2 nm 0 0%
Noninterest income 288 287 297 285 295 302 (7) -2% 1 0%
Noninterest expense 263 257 261 251 255 308 8 3% 6 2%
------ ------ ------ ------ ------ ------ ----- -----
Pretax income (FTE) 124 128 126 126 139 87 (15) -11% (4) -3%
Taxes & FTE adj 45 47 40 44 48 29 (3) -6% (2) -4%
------ ------ ------ ------ ------ ------ ----- -----
Net Income - adjusted 79 81 86 82 91 58 (12) -13% (2) -2%
Significant items- 2Q00 (6) 0 0 0 0 0 (6) nm (6) nm
------ ------ ------ ------ ------ ------ ----- -----
Net income - reported 73 81 86 82 91 58 (18) -20% (8) -10%
Return on equity ** 35% 36% 38% 41% 41% 26% -6% -1%
Efficiency ratio ** 68% 66% 67% 66% 65% 78% 3% 2%
** Net income - adjusted
Loans - avg $ 6.5 $ 6.4 $ 6.0 $ 5.8 $ 5.7 $ 5.4 $ 0.8 14% $ 0.1 2%
Assets - avg 7.5 7.7 7.4 7.1 7.1 6.9 0.4 6% (0.2) -3%
Deposits - avg 8.6 8.7 8.9 8.6 8.7 8.9 (0.1) -1% (0.1) -1%
Common equity - avg 0.9 0.9 0.9 0.8 0.9 0.9 0.0 0% 0.0 0%
Supplemental Information:
-------------------------
Assets Under Management
-----------------------
Mutual Funds - avg $ 66.9 $ 64.6 $ 62.1 $ 58.7 $ 58.3 $ 56.7 $ 8.6 15% $ 2.3 4%
Other - avg 62.5 62.3 65.4 66.4 66.4 66.6 (3.9) -6% 0.2 0%
------ ------ ------ ------ ------ ------ ----- -----
Total - avg $129.4 $126.9 $127.5 $125.1 $124.7 $123.3 $ 4.7 4% $ 2.5 2%
Morningstar Rankings
--------------------
% of 4 & 5 ranked funds 62% 59% 54% 65% 61% 69% 1% 3%
% of 3+ ranked funds 90% 90% 84% 85% 88% 85% 2% 0%
Retail Brokerage
----------------
Mutual fund & annuities sales $1,103 $1,182 $ 941 $ 957 $1,181 $ 893 $ (78) -7% $ (79) -7%
# of accounts (000s) 380 377 360 359 n/a n/a nm nm 3 1%
Mkt value cust. assts-eop ($ bill) $ 23.1 $ 24.0 $ 23.4 n/a n/a n/a nm nm $(0.9) -4%
Wealth Management
-----------------
Loans - avg $ 6.4 $ 6.2 $ 5.8 $ 5.6 $ 5.3 $ 5.1 $ 1.1 21% $ 0.2 3%
Deposits - avg 7.2 7.1 7.2 7.1 7.2 7.2 0.0 0% 0.1 1%
# of Wealth Advisors 654 661 749 758 809 852 (155) -19% (7) -1%
</TABLE>
*2Q00 adjusted for one-time items; FUSA on managed basis.
See 3/17/00 Form 10-K for definitions and methodologies.
27
<PAGE>
BANK ONE CORPORATION LINE OF BUSINESS DETAIL*
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended Jun 30, 2000
--------------------------------------------------- -------------------------------
Income Statement ($ millions) Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Chg Prior Yr. Chg. Prior Qtr
Balance Sheet ($ billions) 2000 2000 1999 1999 1999 1999 Amt % Amt %
---- ---- ---- ---- ---- ---- --- --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Corporate Investments
------------------------
Net interest income FTE $ 30 $ 35 $ 36 $ 41 $ 48 $ 50 $(18) -38% $ (5) -14%
Provision 1 1 0 0 0 0 1 nm 0 0%
Noninterest income 52 185 97 97 97 116 (45) -46% (133) -72%
Noninterest expense 31 39 33 30 34 37 (3) -9% (8) -21%
---- ---- ---- ---- ---- ---- ---- -----
Pretax income (FTE) 50 180 100 108 111 129 (61) -55% (130) -72%
Taxes & FTE adj (11) 39 12 19 21 25 (32) -152% (50) -128%
---- ---- ---- ---- ---- ---- ---- -----
Net income - adjusted 61 141 88 89 90 104 (29) -32% (80) -57%
Significant items- 2Q00 0 0 0 0 0 0 0 nm 0 nm
---- ---- ---- ---- ---- ---- ---- -----
Net income - reported 61 141 88 89 90 104 (29) -32% (80) -57%
Return on equity ** 20% 47% 35% 35% 36% 42% -16% -27%
Efficiency ratio ** 38% 18% 25% 22% 23% 22% 15% 20%
** Net income - adjusted
Loans - avg $3.5 $3.4 $3.4 $3.5 $3.4 $3.5 $0.1 3% $ 0.1 3%
Assets - avg 8.4 8.0 7.9 7.6 7.5 8.0 0.9 12% 0.4 5%
Common equity - avg 1.2 1.2 1.0 1.0 1.0 1.0 0.2 20% 0.0 0%
</TABLE>
*2Q00 adjusted for one-time items; FUSA on managed basis.
See 3/17/00 Form 10-K for definitions and methodologies.
28
<PAGE>
BANK ONE CORPORATION LINE OF BUSINESS DETAIL*
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended Jun 30, 2000
------------------------------------------------------ -----------------------------------
Income Statement ($ millions) Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31 Chg Prior Yr. Chg. Prior Qtr
Balance Sheet ($ billions) 2000 2000 1999 1999 1999 1999 Amt % Amt %
---- ---- ---- ---- ---- ---- --- - --- -
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Corporate/Unallocated
-------------------------------
Net interest income FTE $ (75) $ (115) $ 8 $ 21 $ 37 $ 42 $ (112) -303% $ 40 35%
Provision 0 0 (44) 0 (14) (49) 14 100% 0 nm
Noninterest income 10 118 111 110 105 107 (95) -90% (108) -92%
Noninterest expense 51 78 47 17 18 (5) 33 183% (27) -35%
------ ------- ----- ------ ------ ------ ------- -------
Pretax income (FTE) (116) (75) 116 114 138 203 (254) -184% (41) 55%
Taxes & FTE adj (46) (39) 27 25 39 56 (85) -218% (7) 18%
------ ------- ----- ------ ------ ------ ------- -------
Net Income - adjusted (70) (36) 89 89 99 147 (169) -171% (34) 94%
Significant items- 2Q00 (660) 0 0 0 0 0 (660) nm (660) nm
------ ------- ----- ------ ------ ------ ------- -------
Net income - reported (730) (36) 89 89 99 147 (829) -837% (694) 1928%
Assets - avg $ 42.0 $ 35.3 $ 36.3 $ 34.1 $ 32.8 $ 32.3 $ 9.2 28% $ 6.7 19%
Deposits - avg 20.5 22.1 20.8 20.2 17.0 16.0 3.5 21% (1.6) -7%
Common equity - avg (0.9) 0.0 1.7 1.8 2.5 2.2 (3.4) -136% (0.9) nm
Net Income by LOB
Retail $ 247 $ 236 $ 236 $ 268 $ 290 $ 247 $ (43) -15% $ 11 5%
Commercial Banking 214 200 199 198 203 188 11 5% 14 7%
First USA 113 67 206 288 339 302 (226) -67% 46 69%
Investment Management 79 81 86 82 91 58 (12) -13% (2) -2%
Corporate Investments 61 141 88 89 90 104 (29) -32% (80) -57%
Corporate/Unallocated (70) (36) 89 89 99 147 (169) -171% (34) 94%
------ ------- ----- ------ ------ ------ ------- -------
Total Adjusted 644 689 904 1,014 1,112 1,046 (468) -42% (45) -7%
1999 = merger related
2000 = significant items (1,913) 0 (493) (89) (120) 105 (1,793) 1494% (1,913) nm
------ ------- ----- ------ ------ ------ ------- -------
Total Corporation - reported (1,269) 689 411 925 992 1,151 (2,261) -228% (1,958) -284%
Adj. Net Income by LOB %
Retail 38.4% 34.3% 26.1% 26.4% 26.1% 23.6%
Commercial Banking 33.2% 29.0% 22.0% 19.5% 18.3% 18.0%
First USA 17.5% 9.7% 22.8% 28.4% 30.5% 28.9%
Investment Management 12.3% 11.8% 9.5% 8.1% 8.2% 5.5%
Corporate Investments 9.5% 20.5% 9.7% 8.8% 8.1% 9.9%
Corporate/Unallocated -10.9% -5.3% 9.9% 8.8% 8.8% 14.1%
Total Adjusted 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
</TABLE>
*2Q00 adjusted for one-time items; FUSA on managed basis.
See 3/17/00 Form 10-K for definitions and methodologies.
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