SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
- --------------------------------------------------------------------------------
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(MARK ONE):
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _____________ to _____________
Commission File Number 1-10000
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
FIRST UNION CORPORATION
SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
FIRST UNION CORPORATION
ONE FIRST UNION CENTER
CHARLOTTE, NORTH CAROLINA 28288-0013
<PAGE>
(a) The following financial statements and reports, which have
been prepared pursuant to the requirements of the Employee Retirement Income
Security Act of 1974, are filed as part of this Annual Report on Form 11-K:
Independent Auditors Report.
Financial Statements:
Statement of Net Assets Available
for Benefits, December 31, 1998 and
1997.
Statement of Changes in Net Assets
Available for Benefits for the Year
Ended December 31, 1998.
Notes to Financial Statements.
Supplemental Schedules:
Schedule of Assets Held for
Investment Purposes, December 31,
1998.
Schedule of Reportable Transactions
for the Year Ended December 31,
1998.
Schedule of Nonexempt Transactions
for the Year Ended December 31,
1998.
(b) The following Exhibit is filed as part of this Annual
Report on Form 11-K:
Independent Auditors' Consent
<PAGE>
FIRST UNION CORPORATION
SAVINGS PLAN
Financial Statements
and Schedules
December 31, 1998 and 1997
(With Independent Auditors' Report Thereon)
<PAGE>
Independent Auditors' Report
The Human Resources Committee
First Union Corporation
We have audited the accompanying statements of net assets available for benefits
of First Union Corporation Savings Plan (the Plan) as of December 31, 1998 and
1997, and the related statement of changes in net assets available for benefits
for the year ended December 31, 1998. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan as
of December 31, 1998 and 1997, and the changes in net assets available for plan
benefits for the year ended December 31, 1998 in conformity with generally
accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the financial
statements taken as a whole. The supplemental schedules of assets held for
investment purposes as of December 31, 1998, reportable transactions for the
year ended December 31, 1998, and nonexempt transactions as of December 31,
1998, are presented for the purpose of additional analysis and are not a
required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. These supplemental schedules are the responsibility of the Plan's
management. The fund information in the statement of changes in net assets
available for benefits is presented for purposes of additional analysis rather
than to present the changes in net assets available for plan benefits of each
fund. The supplemental schedules and fund information have been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
KPMG LLP
Charlotte, North Carolina
June 29, 1999
<PAGE>
FIRST UNION CORPORATION
SAVINGS PLAN
Statements of Net Assets Available for Benefits
December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C>
Assets 1998 1997
- ------ -------------- --------------
Trust fund managed by First Union National Bank:
Investments, at fair value:
Marketable:
Evergreen U.S. Government Fund $ 56,234,512 32,787,123
Evergreen Balanced Fund 118,636,341 93,388,192
Stable Fund 485,292,106 429,249,734
Evergreen Foundation Fund 177,215,028 135,304,278
Evergreen Fund 275,508,227 209,359,513
FUNB Enhanced Stock Market Fund 370,774,308 182,559,883
First Union Corporation Common Stock Fund 429,757,020 201,871,062
Evergreen International Growth Fund 28,532,599 --
Mentor Growth Fund II 34,062,566 --
-------------- --------------
1,976,012,707 1,284,519,785
Not readily marketable:
Participants' loans receivable 79,786,991 63,646,544
-------------- --------------
Total investments 2,055,799,698 1,348,166,329
-------------- --------------
Net assets available for benefits $2,055,799,698 1,348,166,329
-------------- --------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FIRST UNION CORPORATION
SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits With Fund Information
For the Year Ended December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
------------- ------------- ------------- --------------- -------------
Evergreen U.S. Evergreen Stable Evergreen Evergreen
Government Fund Balanced Fund Fund Foundation Fund Fund
------------- ------------- ------------- --------------- -------------
Investment income:
Interest $ -- -- -- -- --
Net appreciation (depreciation) in
fair value of investments 3,602,536 11,508,834 28,666,005 18,213,723 17,719,821
------------- ------------- ------------- ------------- -------------
Total investment income 3,602,536 11,508,834 28,666,005 18,213,723 17,719,821
------------- ------------- ------------- ------------- -------------
Employer contributions 1,296,400 4,105,491 21,532,267 8,024,863 12,646,968
Employee contributions 2,225,467 7,821,344 26,488,104 12,300,747 19,236,478
Net assets acquired through mergers 14,733,237 11,916,166 107,620,713 4,517,502 40,018,039
Transfers from other funds 9,516,613 2,619,491 14,019,425 14,381,367 5,998,890
------------- ------------- ------------- ------------- -------------
Total additions 31,374,253 37,971,326 198,326,514 57,438,202 95,620,196
------------- ------------- ------------- ------------- -------------
Participants' withdrawals 7,070,481 9,678,863 85,460,515 10,794,848 17,809,814
Administrative expenses 52,003 109,710 448,778 163,881 254,778
Transfers to other funds 804,380 2,934,604 56,374,849 4,568,723 11,406,890
------------- ------------- ------------- ------------- -------------
Total deductions 7,926,864 12,723,177 142,284,142 15,527,452 29,471,482
------------- ------------- ------------- ------------- -------------
Net increase in net assets
available for benefits 23,447,389 25,248,149 56,042,372 41,910,750 66,148,714
Net assets available for benefits:
Beginning of year 32,787,123 93,388,192 429,249,734 135,304,278 209,359,513
------------- ------------- ------------- ------------- -------------
End of year $ 56,234,512 118,636,341 485,292,106 177,215,028 275,508,227
------------- ------------- ------------- ------------- -------------
<CAPTION>
<S> <C> <C> <C> <C> <C>
----------------- ----------------- ----------------------- --------------
FUNB Enhanced First Union Evergreen International Mentor
Stock Market Fund Common Stock Fund Growth Fund Growth Fund II
----------------- ----------------- ----------------------- --------------
Investment income:
Interest $ -- -- -- --
Net appreciation (depreciation) in
fair value of investments 78,450,878 64,845,329 (400,753) 2,361,963
------------- ------------- ------------- -------------
Total investment income 78,450,878 64,845,329 (400,753) 2,361,963
------------- ------------- ------------- -------------
Employer contributions 14,540,671 9,978,740 969,584 1,233,696
Employee contributions 21,783,303 14,414,823 1,429,776 1,757,339
Net assets acquired through mergers 119,330,886 186,371,915 19,246,597 18,847,095
Transfers from other funds 8,512,143 11,044,668 9,367,696 10,993,572
------------- ------------- ------------- -------------
Total additions 242,617,881 286,655,475 30,612,900 35,193,665
------------- ------------- ------------- -------------
Participants' withdrawals 45,948,627 52,622,835 1,734,105 805,966
Administrative expenses 342,876 397,421 26,386 31,500
Transfers to other funds 8,111,953 5,749,261 319,810 293,633
------------- ------------- ------------- -------------
Total deductions $54,403,456 58,769,517 2,080,301 1,131,099
------------- ------------- ------------- -------------
Net increase in net assets
available for benefits 188,214,425 227,885,958 28,532,599 34,062,566
Net assets available for benefits:
Beginning of year 182,559,883 201,871,062 -- --
------------- ------------- ------------- -------------
End of year 370,774,308 429,757,020 28,532,599 34,062,566
------------- ------------- ------------- -------------
<CAPTION>
<S> <C> <C>
---------------- -------------
Participants'
Loans Receivable Total
---------------- -------------
Investment income:
Interest $ 5,929,744 5,929,744
Net appreciation (depreciation) in
fair value of investments -- 224,968,336
------------- -------------
Total investment income 5,929,744 230,898,080
------------- -------------
Employer contributions -- 74,328,680
Employee contributions -- 107,457,381
Net assets acquired through mergers 10,238,722 532,840,872
Transfers from other funds 32,516,322 118,970,187
------------- -------------
Total additions 48,684,788 1,064,495,200
------------- -------------
Participants' withdrawals 4,138,257 236,064,311
Administrative expenses -- 1,827,333
Transfers to other funds 28,406,084 118,970,187
------------- -------------
Total deductions 32,544,341 356,861,831
------------- -------------
Net increase in net assets
available for benefits 16,140,447 707,633,369
Net assets available for benefits:
Beginning of year 63,646,544 1,348,166,329
------------- -------------
End of year $79,786,991 2,055,799,698
------------- -------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FIRST UNION CORPORATION
SAVINGS PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(1) Description of Plan
The following brief description of the First Union Corporation Savings Plan
(the Plan) is provided for general information purposes only. Participants
should refer to the Plan agreement for more complete information.
(a) General. First Union Corporation and its subsidiaries (the Company)
sponsor the Plan, which is designed to promote savings for retirement.
It is a defined contribution plan subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA). Company and
employee contributions are held in trust and earn income tax-free
until distributed.
(b) Eligibility, Contributions and Benefits. Under the Plan, an employee
is eligible to participate after one year of service. Employee
contributions, pre-tax and after-tax, are elected by the participant
and cannot exceed 15 percent of the employee's gross compensation. The
percentage of the employer matched contribution is determined annually
by the Board of Directors of First Union Corporation (First Union),
and the contribution amounts are paid from net income or accumulated
earnings in accordance with the provisions of the Internal Revenue
Code of 1986 as amended together with all regulations, revenue rulings
and revenue procedures issued thereunder (the Code). The employer's
matching contribution cannot exceed 6 percent of a participant's base
compensation. Participants are fully vested in their entire account
balances at all times.
Four types of withdrawals are allowed under the Plan: normal,
specified cause, hardship and after age 59 1/2. Each type of
withdrawal must be approved by the Human Resources Committee (the
Committee). Participants may withdraw up to their entire account
balance, depending on the type of withdrawal, net of applicable
withholdings and/or loan balances, or a minimum of $500. The amount of
tax withholding depends on the type of withdrawal.
Participants may borrow up to 50 percent of the balance of their
accounts with a minimum loan of $1,000 and a maximum of $50,000. Loan
balances are charged interest at a fixed rate for the life of the
loan. The interest rate is determined at origination as the quoted
Wall Street Journal prime interest rate as of the 25th of the
preceding month. Loans are made for a minimum of 12 months or a
maximum of 60 months. Loan repayments are made bi-weekly as a payroll
deduction. If a participant retires or is otherwise terminated, the
loan balance must be paid in full or the outstanding balance will be
considered as a taxable distribution.
Participants, at retirement, may elect to receive a distribution of
their account balances. A participant is considered retired if: it is
the participant's 65th birthday, 50th birthday with 10 or more years
of service, or the determination that the participant is totally
disabled. Distributions may be made in a lump sum, in installments or
in a combination of both. Installment payments must be in multiples of
$50 over a period not to exceed the life expectancy of the
participant. Distribution of a retired participant's account balance
must begin at age 70 1/2.
Although the employer has not expressed any intent to terminate the
Savings Plan and Trust Agreement, it may do so at any time subject to
the provisions of ERISA. If the Plan is terminated, the accounts of
each participant shall be adjusted in accordance with Plan provisions.
(continued)
<PAGE>
2
FIRST UNION CORPORATION
SAVINGS PLAN
Notes to Financial Statements
(c) Investments. In accordance with the Plan provisions, Plan earnings are
allocated to participants' accounts on a daily basis.
The investment options available to participants at December 31, 1998
and 1997 are:
Evergreen U.S. Government Fund - This mutual fund invests primarily in
debt instruments issued or guaranteed by the U.S. Government or its
agencies. Its objective is to provide a high level of current income
consistent with stability of principal.
Evergreen Balanced Fund - This mutual fund maintains a diversified
investment portfolio of common and preferred stocks, U.S. Government
and agency obligations, and corporate bonds. Its objective is to
produce long-term total return through capital appreciation, dividends
and interest income.
Stable Fund - This pooled investment fund invests primarily in money
market instruments, investment contracts, U.S. Government and agency
securities, and corporate notes. Its investment objective is to
provide stable principal value combined with a yield that is one
percentage point or more over the 91-day U.S. Treasury bills yield.
Evergreen Foundation Fund - This mutual fund invests primarily in a
combination of income producing common stocks, preferred stocks,
convertible securities, corporate and U.S. Government debt
obligations, and short-term debt instruments. Its investment objective
is to provide income, conservation of capital and capital
appreciation.
Evergreen Fund - This mutual fund invests primarily in common stocks,
including securities convertible into or exchangeable for common
stocks of companies which are little-known or relatively small or
special situations, which offer the potential for capital
appreciation. The remainder of its portfolio consists of securities of
relatively well-known and large companies in an attempt to provide
liquidity as well as potential for capital appreciation.
FUNB Enhanced Stock Market Fund - This collective investment fund
invests primarily in a diversified portfolio of common stocks and S&P
500 futures contracts. Its investment objective is to provide a total
rate of return equal to or exceeding that of the S&P 500 market index
each calendar year.
First Union Corporation Common Stock Fund - This fund invests in First
Union Corporation Common Stock. Dividends are reinvested in additional
shares of First Union Corporation Common Stock. Its primary investment
objective is long-term capital appreciation.
(continued)
<PAGE>
3
FIRST UNION CORPORATION
SAVINGS PLAN
Notes to Financial Statements
Evergreen International Growth Fund - This fund invests primarily in
internationally diversified portfolios consisting of common and
preferred stocks, convertible securities and warrants The fund also
uses stock index and currency futures. Its investment objective is to
provide long-term capital appreciation.
Mentor Growth Fund II - This fund invests principally in common stocks
of small to mid-sized companies that have demonstrated earnings, asset
values, or growth potential not yet reflected in their market price.
Its investment objective is long-term capital growth.
(2) Summary of Significant Accounting Policies
The following are the significant accounting policies followed by the Plan:
(a) Investments. The specific identification method is used in determining
the cost of securities. Purchases and sales of securities are recorded
on a trade-date basis.
Investments in commercial paper, cash management accounts and
participants' loans receivable are stated at cost which approximates
fair value. Investments in U.S. Government and Agency securities,
corporate notes, mutual funds, the collective investment fund and
common stock are stated at fair value, which is based on closing
market quotations (or an estimate thereof).
In accordance with the American Institute of Certified Public
Accountant's Statement of Position 94-4, the Stable Fund's holdings of
investment contracts are generally stated at contract value plus
accrued interest because they are considered to be benefit responsive,
thus providing reasonable access to the funds by participants. If Plan
management is aware that an event has occurred that may affect the
ability to recover the full value of a contract, the contract is
reported at its estimated realizable value. Otherwise the fair value
of investment contracts approximates the contract value, including any
accrued interest.
Interest and dividends earned on assets in the Stable Fund are treated
as gains in appreciation of the fair value of the fund, since all
income received by the fund is reinvested in the fund and thus
increases the participants' share value.
(b) Basis of Presentation. The accompanying financial statements are
prepared on an accrual basis in accordance with generally accepted
accounting principles.
The preparation of the financial statements in conformity with
generally accepted accounting principles requires the plan
administrator to make estimates and assumptions that affect reported
amounts of assets and liabilities and disclosure of contingent
liabilities at the date of the financial statements, as well as
additions and deductions to and from these amounts during the
reporting period. Actual results could differ from those estimates.
(continued)
<PAGE>
4
FIRST UNION CORPORATION
SAVINGS PLAN
Notes to Financial Statements
(3) Investments
The following table presents the fair values of investments at December 31,
1998 and 1997. Investments that represent 5 percent or more of the Plan's
net assets are separately identified. The investment contracts held by the
Stable Fund have crediting interest rates of 5.90% - 8.25% and 5.55% -
8.25% at December 31, 1998 and 1997, respectively, with remaining
maturities not greater than 2 years. The average yields for the investment
contracts were 5.9% - 8.2% and 5.6% - 8.2% for the years ended December 31,
1998 and 1997 respectively.
Investments at fair value, as determined by quoted market price:
<TABLE>
<CAPTION>
<S> <C> <C>
1998 1997
---- ----
Evergreen U.S. Government Fund $ 56,234,512 32,787,123
Evergreen Balanced Fund 118,636,341 93,388,192
Evergreen Foundation Fund 177,215,028 135,304,278
Evergreen Fund 275,508,227 209,359,513
FUNB Enhanced Stock Market Fund 370,774,308 182,559,883
Evergreen International Growth Fund 28,532,599 -
Mentor Growth Fund II 34,062,566 -
First Union Corporation Common Stock Fund:
Cash Management Account 24,277,042 13,467,042
First Union Corporation Common Stock 405,479,978 188,404,020
Stable Fund:
U.S. Government and Agency securities - 28,291,990
Corporate Notes $ 264,607,540 220,575,424
Investments at cost, which approximates fair value:
Stable Fund:
Cash Management Accounts $ 17,763,863 7,374,256
Commercial Paper 93,806,668 15,761,350
Investment Contracts 103,928,032 152,133,944
Participants' Loans Receivable $ 79,786,991 63,646,544
</TABLE>
In 1998, the Plan's investments (including investments bought, sold and
held during the year) appreciated (depreciated) in value as follows:
Evergreen U.S. Government Fund $ 3,602,536
Evergreen Balanced Fund 11,508,834
Evergreen Foundation Fund 18,213,723
Evergreen Fund 17,719,821
FUNB Enhanced Stock Market Fund 78,450,878
First Union Corporation Common Stock Fund 64,845,329
Evergreen International Growth Fund (400,753)
Mentor Growth Fund II 2,361,963
Stable Fund 28,666,005
------------
Net appreciation in fair value
of investments $ 224,968,336
------------
(continued)
<PAGE>
5
FIRST UNION CORPORATION
SAVINGS PLAN
Notes to Financial Statements
(4) Income Taxes
The Internal Revenue Service ("IRS") has determined and informed the
Company by a letter dated December 3, 1996, that the Plan is qualified and
the trust established under the Plan is tax-exempt under the appropriate
sections of the Code, and accordingly, no provision for income taxes has
been made. The Committee files an annual information return with the
Internal Revenue Service. The Plan has been amended since receiving the
determination letter; however, the Plan administrator believes that the
Plan is currently designed and operated in compliance with the applicable
requirements of the Code.
(5) Transactions with Related Parties
The Evergreen U.S. Government Fund, the Evergreen Balanced Fund, the
Evergreen Foundation Fund, the Evergreen Fund, the Evergreen International
Growth Fund and the Mentor Growth Fund II are mutual funds managed by
subsidiaries of First Union National Bank. The FUNB Enhanced Stock Market
Fund is a collective investment trust managed by First Union National Bank.
The Stable Fund investments are managed by First Union National Bank. The
First Union Corporation Common Stock Fund is managed by First Union
National Bank, and it is principally comprised of shares of First Union
Corporation common stock.
First Union National Bank, a party in interest, serves as the trustee for
the Plan. In 1998, the Plan paid administrative expenses to First Union
National Bank amounting to $1,827,333.
(6) Mergers with Financial Institutions
Employees of institutions acquired by the Company are allowed to
participate in the Plan as of the consummation date of each respective
merger. As a result of acquisitions by the Company, assets of qualified
plans are transferred into the Plan.
In November 1997, Signet Banking Corporation was acquired by First Union
Corporation. Assets of the Signet Banking Corporation Employee Savings
Plan, which were approximately $252 million, were transferred to the Plan
on January 2, 1998.
In 1998, assets of the savings plans of Covenant Bancorp, Inc. and Wheat
First Butcher Singer, Inc. were merged into the Plan. Their plan assets
were approximately $1 million and $276 million, respectively.
In April 1998, CoreStates Financial Corp was acquired by First Union
Corporation. Assets of their plans, which were approximately $1.1 billion,
were transferred to the Plan on January 14, 1999.
<PAGE>
Schedule 1
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
Mutual Funds
4,010,963 Evergreen U.S. Government Fund * $ 50,691,812 56,234,512
5,249,724 Evergreen Balanced Fund * 92,086,943 118,636,341
7,274,653 Evergreen Foundation Fund * 137,550,632 177,215,028
10,136,054 Evergreen Fund * 214,827,195 275,508,227
3,585,657 Evergreen International Growth Fund * 28,577,497 28,532,599
1,898,323 Mentor Growth Fund II * 31,265,165 34,062,566
--------------- ----------------
Total Mutual Funds 554,999,244 690,189,273
--------------- ----------------
Collective Investment Fund
5,016,693 First Union Enhanced Stock Market Fund * 267,005,540 370,774,308
--------------- ----------------
First Union Corporation Common Stock Fund
19,541,346 First Union Corporation Common Stock * 134,827,731 405,479,978
24,277,042 Valiant General Fund -
Cash Management Account 24,277,042 24,277,042
--------------- ----------------
Total First Union Corporation
Common Stock Fund 159,104,773 429,757,020
--------------- ----------------
Stable Fund *
Cash Management Accounts
17,763,863 Valiant General Fund #62 17,763,863 17,763,863
--------------- ----------------
Total Cash Management Accounts 17,763,863 17,763,863
--------------- ----------------
</TABLE>
<PAGE>
Schedule 1
----------
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
Commercial Paper
15,000,000 Ascot Capital Corporation
Dated 10/15/98, due
01/20/99 14,799,800 14,799,800
15,000,000 Barton Cap Corporation
Dated 11/01/98, due
02/03/99 14,833,750 14,833,750
10,000,000 Broadway
Dated 12/21/98, due
01/19/99 9,954,244 9,954,244
15,000,000 Compass Securitization
Dated 11/20/98, due
03/31/99 14,713,437 14,713,437
15,000,000 Moat FDG LLC
Dated 10/19/98, due
01/25/99 14,850,675 14,850,675
15,000,000 Sigma Financial
Dated 11/17/98, due
02/23/99 14,788,229 14,788,229
10,000,000 Thames Asset Global
Dated 10/20/98, due
01/20/99 9,866,533 9,866,533
--------------- ----------------
Total Commercial Paper 93,806,668 93,806,668
--------------- ----------------
Corporate Notes
342,766 MMCA Auto Grantor Trust
Dated 12/14/95
5.7%, due 11/15/00 342,437 343,083
1,238,579 TMS Home Equity Loan
Dated 6/01/92
6.9%, due 7/15/07 1,251,507 1,243,651
</TABLE>
<PAGE>
Schedule 1
----------
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
10,000,000 American Express Travel Euro Bond
Dated 10/24/96
5.72%, due 10/24/01 9,995,000 10,003,300
10,000,000 Associates Corporation North America
Dated 8/27/98,
5.35%, due 8/27/01 9,994,450 9,948,620
10,000,000 Bankers Trust New York Euro Series Note
Dated 2/5/96,
5.92%, due 2/05/01 10,000,000 9,904,290
7,000,000 Bear Stearns Company Incorporated
Dated 4/29/97
4.22%, due 4/28/00 6,980,330 6,968,990
7,000,000 BT Securities Corporation
Dated 2/24/97
5.95%, due 2/24/00 7,000,000 6,986,203
5,000,000 Cedar International
Dated 7/10/98
6.01%, due 6/16/00 5,001,705 5,000,000
10,000,000 Citicorp Medium Notes
Dated 11/24/97,
5.35%, due 5/24/01 10,007,610 9,957,340
19,290,000 Countrywide Funding Corporation
Dated 8/08/96,
5.56%, due 8/08/00 19,300,802 19,265,617
3,000,000 Dean Witter & Company
Dated 2/01/96,
5.72%, due 2/01/99 3,004,200 3,001,158
10,000,000 Fleet National Bank
Dated 12/14/98,
5.47%, due 12/14/01 10,000,000 9,998,540
</TABLE>
<PAGE>
Schedule 1
----------
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
7,000,000 Ford Motor Company
Dated 2/15/94,
4.2%, due 2/15/99 7,000,000 6,995,114
15,000,000 General Motors Acceptance Corporation
Dated 12/09/96
5.69%, due 12/10/01 14,986,245 14,919,585
10,000,000 Goldman Sachs Group Limited Partnership
Dated 1/13/98,
5.53%, due 1/16/01 10,006,150 9,967,130
7,500,000 Heller Financial Incorporated
Dated 4/27/94,
5.46%, due 4/27/99 7,524,068 7,502,175
10,000,000 Hitachi Credit America Corporation
Dated 7/07/98,
5.94%, due 7/07/00 10,000,000 9,973,220
10,000,000 Hitachi Credit America Corporation
Dated 5/01/98,
5.53%, due 5/15/00 10,005,120 9,980,680
5,000,000 International Paper Company
Dated 8/07/96,
5.5%, due 8/09/99 5,000,000 4,999,555
3,400,000 Lehman Brothers Holdings Incorporated
Dated 11/18/96,
5.73%, due 5/18/99 3,408,874 3,389,344
10,000,000 Lehman Brothers Holdings Incorporated
Dated 5/14/96,
5.77%, due 5/14/99 10,036,970 9,967,200
5,000,000 McDonnell Douglas Financial Corporation
Dated 5/27/94,
5.88%, due 5/28/99 5,041,550 5,011,350
</TABLE>
<PAGE>
Schedule 1
----------
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
14,000,000 Merrill Lynch & Company
Dated 8/10/98,
Variable rate, due 08/10/01 13,884,500 13,937,028
15,000,000 Merrill Lynch & Company
Dated 9/21/98,
5.67%, due 9/21/01 15,000,000 14,932,575
10,000,000 Morgan Stanley Dean Witter Discover & Company
Dated 2/20/98,
5.35%, due 2/23/01 10,000,000 9,971,580
13,000,000 Morgan Stanley Dean Witter
Dated 1/21/98,
5.24%, due 1/21/00 13,000,000 12,984,712
12,500,000 Consolidated Edison of New York
Dated 7/06/94,
5.5%, due 7/01/99 12,512,800 12,511,200
15,000,000 Ford Motor Credits Company
Dated 8/27/98,
5.35%, due 8/27/01 14,989,710 14,971,800
10,000,000 Advance Bank Australia Euro Bond
Dated 10/25/95,
5.78%, due 11/30/00 10,000,000 9,972,500
--------------- ----------------
Total Corporate Notes 265,274,028 264,607,540
--------------- ----------------
</TABLE>
<PAGE>
Schedule 1
----------
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
Investment Contracts
5,304,973 Allstate Life Insurance Company
Contract #GA5730
8.25%, due 9/5/00 6,684,099 6,684,099
5,423,114 Continental Assurance Company
Contract #13076 6,823,882 6,823,882
8.2%, due 6/5/00
5,423,114 Continental Assurance Company
Contract #13076
8.2%, due 6/5/99 6,823,882 6,823,882
10,000,000 ITT Hartford Life Insurance Company
Contract #GA9929
7.15%, due 4/07/99 13,867,250 13,867,250
5,523,437 Metropolitan Life Insurance Company
Contract #20073
7.34%, due 9/15/99 6,790,184 6,790,184
5,578,400 Monumental Life Insurance Company
Contract #BDA00428FR
7.42%, due 12/15/99 6,873,435 6,873,435
9,258,227 Monumental Life Insurance Company
Contract #00198ST
Variable rate, open-ended maturity 9,361,276 9,361,276
5,388,167 New York Life Insurance Company
Contract #GA06837003
8.13%, due 3/01/00 6,767,113 6,767,113
5,031,399 Pacific Mutual Life Insurance Company
Contract #G2618801
6.34%, due 9/01/00 6,019,415 6,019,415
10,030,401 Protective Life Insurance Company
Contract #GA1012
7.17%, due 4/15/99 13,861,089 13,861,089
</TABLE>
<PAGE>
Schedule 1
----------
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
IRS Form 5500 - Line 27a
December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Number of Identity of Issue, Borrower, Lessor or
Shares or Similar Party, and Description of
Par or Face Investment, Including Maturity Date, Rate of Fair
Value Interest, Collateral, and Par or Maturity Value Cost Value
- ------------ ------------------------------------------------------- ------------------ ----------------
5,575,787 Protective Life Insurance Company
Contract #GA1055
7.39%, due 6/15/99 6,863,966 6,863,966
6,703,540 Protective Life Insurance Company
Contract #GA951
5.9%, due 3/1/99 7,922,781 7,922,781
5,000,000 Sunamerica Life Insurance Company
Contract #FA4338
6.38%, due 2/25/99 5,269,660 5,269,660
--------------- ----------------
Total Investment Contracts 103,928,032 103,928,032
--------------- ----------------
Accrued Receivable on Assets
of the Stable Fund 5,186,003 5,186,003
--------------- ----------------
Total Stable Fund 485,958,594 485,292,106
--------------- ----------------
Participants' Loans Receivable
79,786,991 Participants' Loans Receivable -
various rates and maturities* 79,786,991 79,786,991
--------------- ----------------
Total Investments $ 1,546,855,142 2,055,799,698
--------------- ----------------
</TABLE>
* Denotes a Party-in-Interest
<PAGE>
Schedule 2
FIRST UNION CORPORATION
SAVINGS PLAN
Schedule of Reportable Transactions
IRS Form 5500 - Line 27d
For the year ended December 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Identity of Party / Purchase Selling Cost of Net
Description of the Asset Price Price Asset Gains
- ------------------------------------ ---------------- ------------- ------------ -----------
Mutual Funds
- ------------
Evergreen Fund $113,527,904 64,857,562 54,403,664 10,453,898
Collective Investment Fund
- --------------------------
First Union Enhanced Stock Market Fund $134,934,701 106,438,122 89,997,146 16,440,976
Common Stock Fund
- -----------------
First Union Corporation Common Stock $194,991,984 112,670,211 61,466,828 51,203,383
Pooled Investment Fund
- ----------------------
Stable Fund $177,853,989 224,779,323 207,060,118 17,719,205
</TABLE>
Note 1: The transactions set forth herein are those that individually or in the
aggregate, by security or person, involve an amount in excess of five percent
($67,408,316) of the current value of the Plan assets ($1,348,166,329) at the
beginning of the Plan year.
Note 2: There was no lease rental or transaction expense incurred with any of
the above transactions. Additionally, the current value of each asset at its
transaction date was the same as its purchase price for new purchases and its
selling price for investment sales.
<PAGE>
Schedule 3
First Union Corporation
Savings Plan
Schedule of Nonexempt Transactions
IRS Form 5500 - Line 27e
For the year ended December 31, 1998
In the prior Plan Year, the Plan Sponsor substantially modified its payroll
system. Because of programming problems and related issues, participant
contributions were contributed to the trust beyond the maximum time period
described in 29 CFR 2510.3-102. Such contributions have and are being corrected.
The total amount of such participant contributions is approximately $1.7
million.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the plan administrator has duly caused this annual report to be signed on
its behalf by the undersigned hereunto duly authorized.
FIRST UNION CORPORATION
SAVINGS PLAN
By: /s/ Benjamin J. Jolley
----------------------
Name: Benjamin J. Jolley
Title: Vice President
Date: June 29, 1999
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION LOCATION
- ----------- ----------- --------
<S> <C> <C>
(23) Independent Auditors' Consent Filed herewith
</TABLE>
Exhibit (23)
Independent Auditors' Consent
The Human Resources Committee
First Union Corporation
We consent to the incorporation by reference in the Registration Statement (No.
333-11613) on Form S-8 of the First Union Corporation Savings Plan (the Plan) of
our report dated June 29, 1999, relating to the statements of net assets
available for benefits as of December 31, 1998 and 1997, and the statement of
changes in net assets available for benefits for the year ended December 31,
1998, which report appears in the December 31, 1998 annual report on Form 11-K
of the Plan.
/s/ KPMG LLP
Charlotte, North Carolina
June 29,1999
