MBNA CORP
424B5, 2000-08-16
NATIONAL COMMERCIAL BANKS
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<PAGE>   1

            Prospectus Supplement to Prospectus Dated April 7, 1999.

                               50,000,000 Shares

                                MBNA CORPORATION

                                  Common Stock
                            ------------------------
     The common stock is listed on the New York Stock Exchange under the symbol
"KRB." The last reported sale price of the common stock on the New York Stock
Exchange on August 14, 2000 was $35.50 per share.

                            ------------------------

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY
BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED ON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

     THESE SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF
ANY BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENT AGENCY.

                            ------------------------

     The underwriter will purchase the common stock from MBNA Corporation at a
price of $32.00 per share resulting in $1,600,000,000 aggregate net proceeds
(before expenses) to MBNA Corporation.

     The underwriter may offer the common stock in transactions on the New York
Stock Exchange, in the over-the-counter market or through negotiated
transactions at market prices or at negotiated prices. See "Underwriting."

                            ------------------------

     The underwriter expects to deliver the shares against payment in New York,
New York on August 17, 2000.

                              GOLDMAN, SACHS & CO.

                            ------------------------

                  Prospectus Supplement dated August 14, 2000.
<PAGE>   2

                      [This Page Intentionally Left Blank]

                                       S-2
<PAGE>   3

                                MBNA CORPORATION

     MBNA Corporation, a bank holding company located in Wilmington, Delaware,
is the parent company of MBNA America Bank, N.A., a national bank and MBNA
Corporation's principal subsidiary. MBNA America Bank, N.A. has two wholly owned
foreign bank subsidiaries, MBNA International Bank Limited located in the United
Kingdom and MBNA Canada Bank located in Canada. Through MBNA America Bank, N.A.,
we are the largest independent credit card lender in the world and the leading
issuer of affinity credit cards marketed primarily to members of associations
and customers of financial institutions. In addition to our credit card lending,
we also make other consumer loans and offer insurance and deposit products.

     We generate interest and other income through:

     - finance charges assessed on outstanding loan receivables,

     - interchange income,

     - credit card and other fees,

     - securitization income,

     - insurance income, and

     - interest earned on investment securities and money market instruments.

Our primary costs are the costs of funding our loan receivables and investment
securities and money market instruments, which include:

     - interest paid on deposits, short-term borrowings, and long-term debt and
       bank notes;

     - credit losses;

     - royalties paid to affinity groups and financial institutions;

     - business development and operating expenses; and

     - income taxes.

     As of June 30, 2000, we had total assets of $32.1 billion, deposits of
$20.4 billion and stockholders' equity of $4.5 billion. Our return on average
total assets for the six months ended June 30, 2000 was 3.33%, as compared to
3.05% for the same period during 1999. Our return on average stockholders'
equity for the six months ended June 30, 2000 was 24.44%, as compared to 23.24%
for the same period in 1999.

                              RECENT DEVELOPMENTS

     On August 14, 2000, MBNA Corporation and First Union Corporation executed a
definitive agreement for the purchase by us of First Union's consumer revolving
credit portfolio of $5.3 billion in loans and more than 3 million accounts, and
its commercial credit card portfolio of $215 million in loans and approximately
300,000 accounts as of June 30, 2000. The purchase price represents a premium on
the loan receivables of approximately $1 billion, subject to adjustment. The
transaction is currently expected to close in late September 2000. MBNA
Corporation and First Union also entered into agreements with terms of seven
years for us to market personal, business, corporate and purchasing cards to
First Union's 16 million customers.

                                USE OF PROCEEDS

     We estimate that the net proceeds of this offering (before offering
expenses) will be $1,600,000,000. We intend to use a portion of the net proceeds
from this offering to purchase the consumer revolving credit and commercial
credit card portfolios of First Union Corporation and the remainder for general
corporate purposes.

                                       S-3
<PAGE>   4

                            SELECTED FINANCIAL DATA

     The following selected financial data for the years ended December 31, 1995
through 1999 have been derived from our audited consolidated financial
statements for such periods. The data presented for the six months ended June
30, 2000 and 1999 are derived from our unaudited consolidated financial
statements and were prepared in accordance with generally accepted accounting
principles for interim financial information for such periods. In the opinion of
management, the unaudited consolidated financial statements for the six months
ended June 30, 2000 and 1999 have been prepared on a basis consistent with the
audited consolidated financial statements and reflect all normal, recurring
adjustments necessary to present fairly the financial data and results of
operations for such periods. The results of operations for the six months ended
June 30, 2000 are not necessarily indicative of the results for the full year or
for any other interim period.

     You should read the selected financial data below in conjunction with our
consolidated financial statements and the accompanying notes incorporated by
reference in the Prospectus. See "Incorporation of Certain Information by
Reference" and "Available Information" in the Prospectus.
<TABLE>
<CAPTION>
                                FOR THE SIX MONTHS ENDED
                                        JUNE 30,                          FOR THE YEAR ENDED DECEMBER 31,
                               ---------------------------   ----------------------------------------------------------
                                   2000           1999           1999            1998           1997           1996
                               ------------   ------------   -------------   ------------   ------------   ------------
                                 (UNAUDITED, DOLLARS IN           (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                               THOUSANDS, EXCEPT PER SHARE
                                        AMOUNTS)
<S>                            <C>            <C>            <C>             <C>            <C>            <C>
INCOME STATEMENT DATA
Net interest income..........  $   551,384    $   493,842    $    933,765    $   742,339    $   692,390    $   640,477
Provision for possible credit
 losses......................      189,147        214,220         408,914        310,039        260,040        178,224
Other operating income.......    2,304,407      1,932,262       4,207,821      3,228,969      2,812,879      1,895,923
Other operating expense......    1,826,649      1,544,396       3,077,708      2,407,204      2,223,121      1,626,882
Net income...................      519,957        413,175       1,024,423        776,266        622,500        474,495
PER COMMON SHARE DATA
Earnings(a)..................  $       .64    $       .51    $       1.26    $      1.01    $       .80    $       .61
Earnings -- assuming
 dilution(a).................          .62            .49            1.21            .97            .76            .59
Dividends....................          .16            .14             .28            .24            .21            .19
Book value...................         5.29           4.44            4.97           2.90           2.34           1.87
RATIOS
Return on average total
 assets......................         3.33%          3.05%           3.62%          3.38%          3.25%          3.26%
Return on average
 stockholders' equity........        24.44          23.24           27.18          36.91          35.56          34.46
Average receivables to
 average deposits............        88.93          89.06           85.33          86.04          88.82          92.50
Stockholders' equity to total
 assets......................        13.88          13.48           13.61           9.27           9.25          10.00
Loan Portfolio:
Delinquency(b)...............         3.77           4.17            3.82           3.86           3.93           3.59
Net credit losses............         2.18           2.60            2.63           2.39           2.14           1.98
Managed Loans (c):
Delinquency..................         4.44           4.64            4.45           4.62           4.59           4.28
Net credit losses............         4.01           4.39            4.33           4.31           3.97           3.35
Net interest margin(d).......         7.11           7.65            7.42           7.47           7.50           7.62
MANAGED LOAN DATA (C)
At period end:
 Loans held for
   securitization............  $ 7,426,197    $ 5,410,118    $  9,692,616    $ 1,692,268    $ 2,900,198    $ 2,469,974
 Loan portfolio..............    9,695,285      9,931,874       7,971,093     11,776,099      8,261,876      7,659,078
 Securitized loans...........   59,211,174     49,182,696      54,591,804     46,172,739     38,217,786     28,494,481
                               -----------    -----------    ------------    -----------    -----------    -----------
   Total managed loans.......  $76,332,656    $64,524,688    $ 72,255,513    $59,641,106    $49,379,860    $38,623,533
                               ===========    ===========    ============    ===========    ===========    ===========
Average for the period:
 Loans held for
   securitization............  $ 8,553,426    $ 3,711,138    $  4,071,394    $ 2,577,482    $ 2,875,212    $ 2,529,484
 Loan portfolio..............    8,770,465     10,725,229      10,351,101      9,352,807      7,563,301      6,174,095
 Securitized loans...........   55,708,941     46,640,292      49,706,760     40,970,936     32,746,963     22,514,014
                               -----------    -----------    ------------    -----------    -----------    -----------
   Total managed loans.......  $73,032,832    $61,076,659    $ 64,129,255    $52,901,225    $43,185,476    $31,217,593
                               ===========    ===========    ============    ===========    ===========    ===========
For the period:
 Sales and cash advance
   volume....................  $59,359,147    $47,560,332    $105,806,935    $82,968,874    $66,399,425    $48,666,129

<CAPTION>

                               FOR THE YEAR ENDED DECEMBER 31,
                               ------------
                                   1995
                               ------------
                               (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<S>                            <C>
INCOME STATEMENT DATA
Net interest income..........  $   544,226
Provision for possible credit
 losses......................      138,176
Other operating income.......    1,424,618
Other operating expense......    1,246,067
Net income...................      353,099
PER COMMON SHARE DATA
Earnings(a)..................  $       .47
Earnings -- assuming
 dilution(a).................          .46
Dividends....................          .17
Book value...................         1.48
RATIOS
Return on average total
 assets......................         3.09%
Return on average
 stockholders' equity........        35.51
Average receivables to
 average deposits............        91.60
Stockholders' equity to total
 assets......................         9.56
Loan Portfolio:
Delinquency(b)...............         3.11
Net credit losses............         1.91
Managed Loans (c):
Delinquency..................         3.70
Net credit losses............         2.74
Net interest margin(d).......         7.42
MANAGED LOAN DATA (C)
At period end:
 Loans held for
   securitization............  $ 3,168,427
 Loan portfolio..............    4,967,491
 Securitized loans...........   18,575,786
                               -----------
   Total managed loans.......  $26,711,704
                               ===========
Average for the period:
 Loans held for
   securitization............  $ 2,269,362
 Loan portfolio..............    4,792,536
 Securitized loans...........   15,440,499
                               -----------
   Total managed loans.......  $22,502,397
                               ===========
For the period:
 Sales and cash advance
   volume....................  $34,272,909
</TABLE>

                                       S-4
<PAGE>   5
<TABLE>
<CAPTION>
                                FOR THE SIX MONTHS ENDED
                                        JUNE 30,                          FOR THE YEAR ENDED DECEMBER 31,
                               ---------------------------   ----------------------------------------------------------
                                   2000           1999           1999            1998           1997           1996
                               ------------   ------------   -------------   ------------   ------------   ------------
                                 (UNAUDITED, DOLLARS IN           (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                               THOUSANDS, EXCEPT PER SHARE
                                        AMOUNTS)
<S>                            <C>            <C>            <C>             <C>            <C>            <C>
BALANCE SHEET DATA
Investment securities and
 money market instruments....  $ 4,853,478    $ 4,996,397    $  4,572,052    $ 5,440,939    $ 4,594,709    $ 3,194,664
Loans held for
 securitization..............    7,426,197      5,410,118       9,692,616      1,692,268      2,900,198      2,469,974
Credit card loans............    6,791,080      7,879,505       6,060,564      8,975,051      5,830,221      5,722,299
Other consumer loans.........    2,904,205      2,052,369       1,910,529      2,801,048      2,431,655      1,936,779
                               -----------    -----------    ------------    -----------    -----------    -----------
   Total loans...............    9,695,285      9,931,874       7,971,093     11,776,099      8,261,876      7,659,078
Reserve for possible credit
 losses......................     (375,300)      (326,897)       (355,959)      (216,911)      (162,476)      (118,427)
                               -----------    -----------    ------------    -----------    -----------    -----------
   Net loans.................    9,319,985      9,604,977       7,615,134     11,559,188      8,099,400      7,540,651
Total assets.................   32,137,558     27,995,770      30,859,132     25,806,260     21,305,513     17,035,342
Total deposits...............   20,439,846     16,377,482      18,714,753     15,407,040     12,913,213     10,151,686
Long-term debt and bank
 notes.......................    5,484,948      6,125,799       5,708,880      5,939,025      5,478,917      3,950,358
Stockholders' equity.........    4,459,772      3,773,430       4,199,443      2,391,035      1,970,050      1,704,308
AVERAGE BALANCE SHEET DATA
Investment securities and
 money market instruments....  $ 4,719,717    $ 5,700,510    $  5,797,141    $ 4,905,943    $ 3,851,867    $ 2,927,351
Loans held for
 securitization..............    8,553,426      3,711,138       4,071,394      2,577,482      2,875,212      2,529,484
Credit card loans............    6,278,580      8,447,420       8,184,713      6,820,538      5,456,349      4,907,814
Other consumer loans.........    2,491,885      2,277,809       2,166,388      2,532,269      2,106,952      1,266,281
                               -----------    -----------    ------------    -----------    -----------    -----------
   Total loans...............    8,770,465     10,725,229      10,351,101      9,352,807      7,563,301      6,174,095
Reserve for possible credit
 losses......................     (362,702)      (270,848)       (299,754)      (192,024)      (143,277)      (111,041)
                               -----------    -----------    ------------    -----------    -----------    -----------
   Net loans.................    8,407,763     10,454,381      10,051,347      9,160,783      7,420,024      6,063,054
Total assets.................   31,415,482     27,319,764      28,310,222     22,982,349     19,125,282     14,571,288
Total deposits...............   19,480,022     16,209,034      16,901,334     13,866,645     11,752,887      9,408,843
Long-term debt and bank
 notes.......................    5,695,956      5,957,090       5,974,276      5,873,122      4,639,430      3,029,250
Stockholders' equity.........    4,277,803      3,585,400       3,769,539      2,103,043      1,750,459      1,377,072
Weighted average common
 shares outstanding (000)....      801,835        800,180         801,020        751,856        751,837        751,812
Weighted average common
 shares outstanding and
 common stock
 equivalents (000)...........      825,376        836,840         837,083        789,421        789,801        778,473

<CAPTION>

                               FOR THE YEAR ENDED DECEMBER 31,
                               ------------
                                   1995
                               ------------
                               (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<S>                            <C>
BALANCE SHEET DATA
Investment securities and
 money market instruments....  $ 2,669,402
Loans held for
 securitization..............    3,168,427
Credit card loans............    4,090,553
Other consumer loans.........      876,938
                               -----------
   Total loans...............    4,967,491
Reserve for possible credit
 losses......................     (104,886)
                               -----------
   Net loans.................    4,862,605
Total assets.................   13,228,889
Total deposits...............    8,608,914
Long-term debt and bank
 notes.......................    2,657,600
Stockholders' equity.........    1,265,058
AVERAGE BALANCE SHEET DATA
Investment securities and
 money market instruments....  $ 2,451,783
Loans held for
 securitization..............    2,269,362
Credit card loans............    4,160,230
Other consumer loans.........      632,306
                               -----------
   Total loans...............    4,792,536
Reserve for possible credit
 losses......................     (103,568)
                               -----------
   Net loans.................    4,688,968
Total assets.................   11,425,721
Total deposits...............    7,709,840
Long-term debt and bank
 notes.......................    2,212,591
Stockholders' equity.........      994,287
Weighted average common
 shares outstanding (000)....      751,839
Weighted average common
 shares outstanding and
 common stock
 equivalents (000)...........      770,464
</TABLE>

---------------
(a) Earnings per common share is computed using net income applicable to common
    stock and weighted average common shares outstanding, whereas earnings per
    common share-assuming dilution includes the potential dilutive effect of
    common stock equivalents. MBNA Corporation's common stock equivalents are
    solely related to employee stock options. MBNA Corporation has no other
    common stock equivalents.

(b) MBNA Corporation's loan portfolio delinquency does not include loans held
    for securitization or securitized loans.

(c) Managed loans include MBNA Corporation's loans held for securitization, loan
    portfolio, and securitized loans.

(d) MBNA Corporation's managed net interest margin is presented on a fully
    taxable equivalent basis.

                                       S-5
<PAGE>   6

                                 CAPITALIZATION

     The following table sets forth our consolidated capitalization at June 30,
2000 and as adjusted to give effect to the issuance and sale of the shares of
common stock offered hereby. The table should be read in conjunction with our
consolidated financial statements and the accompanying notes thereto
incorporated by reference in the Prospectus. See "Incorporation of Certain
Documents by Reference" and "Available Information" in the Prospectus.

<TABLE>
<CAPTION>
                                                                   JUNE 30, 2000
                                                              ------------------------
                                                                ACTUAL     AS ADJUSTED
                                                              ----------   -----------
                                                               (UNAUDITED, DOLLARS IN
                                                                     THOUSANDS)
<S>                                                           <C>          <C>
Long-Term Debt and Bank Notes (a)...........................  $5,484,948   $ 5,484,948
Stockholders' Equity:
  Preferred stock...........................................          86            86
  Common stock..............................................       8,018         8,518
  Additional paid-in capital................................   1,213,041     2,812,541
  Retained earnings.........................................   3,282,235     3,282,235
  Accumulated other comprehensive income....................     (43,608)      (43,608)
                                                              ----------   -----------
     Total Stockholders' Equity.............................   4,459,772     6,059,772
                                                              ----------   -----------
     Total Capitalization...................................  $9,944,720   $11,544,720
                                                              ==========   ===========
</TABLE>

---------------
(a) Includes $563.3 million of guaranteed preferred beneficial interests in our
    junior subordinated deferrable interest debentures.

     The federal bank regulatory agencies have had under consideration possible
rulemaking to amend the regulatory capital guidelines for banks and bank holding
companies with respect to the treatment of residual interests in asset
securitizations. No proposed rule has been formally published; however, it is
possible that the agencies will in the near future propose rules requiring
increased regulatory capital requirements in respect of such residual interests
and/or requiring regulatory capital deductions for such interests held above a
specified limit. Either approach would result in a reduction in our regulatory
capital ratios, but we do not currently anticipate any effect that would result
in our becoming less than "well capitalized" for regulatory capital purposes.

                          MARKET PRICE OF COMMON STOCK

     The common stock is listed and traded on the New York Stock Exchange under
the symbol "KRB." As of June 30, 2000, there were 801,781,250 shares of common
stock issued and outstanding. The following table sets forth the high and low
sales price and the closing price per share of the common stock, as reported on
the NYSE Composite Tape for the quarters indicated, as well as the cash
dividends per share of common stock declared by us for the quarters indicated.

<TABLE>
<CAPTION>
                                                                                     DIVIDEND DECLARED
                                                                                        PER COMMON
                                                    HIGH       LOW       CLOSE             SHARE
                                                    ----       ---       -----       -----------------
<S>                                                 <C>        <C>       <C>         <C>
2000
First quarter.....................................  $27 9/16   $20        $25 1/2          $.08
Second quarter....................................   29 5/8     22         27 1/8           .08
Third quarter (through August 14, 2000)...........   35 1/2     26 7/8     35 1/2           .08
1999
First quarter.....................................  $27 15/16  $22 3/16   $23 7/8          $.07
Second quarter....................................   30 3/4     22 1/2     30 5/8           .07
Third quarter.....................................   32 1/2     22 13/16   22 13/16         .07
Fourth quarter....................................   29 1/8     20 15/16   27 1/4           .07
</TABLE>

                                       S-6
<PAGE>   7

<TABLE>
<CAPTION>
                                                                                     DIVIDEND DECLARED
                                                                                        PER COMMON
                                                    HIGH       LOW       CLOSE             SHARE
                                                    ----       ---       -----       -----------------
<S>                                                 <C>        <C>       <C>         <C>
1998
First quarter.....................................  $25        $17 3/16   $23 7/8          $.06
Second quarter....................................   25 5/16    20 5/16    22 1/16          .06
Third quarter.....................................   25 1/16    15 11/16   19 1/16          .06
Fourth quarter....................................   25 3/8     13 3/4     24 13/16         .06
1997
First quarter.....................................  $16 1/2    $12 1/8    $12 3/8          $.05
Second quarter....................................   16 7/16    12 7/16    16 1/4           .05
Third quarter.....................................   20 1/16    16 9/16    18               .05
Fourth quarter....................................   19 1/2     17 1/16    18 3/16          .05
</TABLE>

     Our board of directors has declared a quarterly dividend of $.08 per share
on the common stock, payable October 1, 2000 to stockholders of record as of
September 15, 2000.

                              DIVIDEND LIMITATIONS

     The payment of dividends in the future and the amount of such dividends, if
any, will be at the discretion of our board of directors. The payment of
preferred and common stock dividends by us may be limited by certain factors,
including regulatory capital requirements, broad enforcement powers of the
federal bank regulatory agencies, and tangible net worth maintenance
requirements under our revolving credit facilities. The payment of common stock
dividends may also be limited by the terms of our outstanding preferred stock.
If we have not paid scheduled dividends on the preferred stock, or declared the
dividends and set aside funds for payment, we may not declare or pay any cash
dividends on the common stock. In addition, if we defer interest payments for
consecutive periods covering 10 semiannual periods or 20 consecutive quarterly
periods, depending on the series, on our guaranteed preferred beneficial
interests in MBNA Corporation's junior subordinated deferrable interest
debentures (see "Capitalization"), we may not be permitted to declare or pay any
cash dividends on our capital stock or interest on debt securities that have
equal or lower priority than the junior subordinated deferrable interest
debentures. During the six months ended June 30, 2000, we declared dividends on
our preferred stock of $7.4 million and on our common stock of $128.3 million.

     MBNA Corporation is a legal entity separate and distinct from its banking
and other subsidiaries. The primary source of funds for payment of preferred and
common stock dividends by MBNA Corporation is dividends received from MBNA
America Bank, N.A. The amount of dividends that a bank may declare in any year
is subject to certain regulatory restrictions. Generally, dividends declared in
a given year by a national bank are limited to its net profit, as defined by
regulatory agencies, for that year, combined with its retained net income for
the preceding two years, less any required transfers to surplus or to a fund for
the retirement of any preferred stock. In addition, a national bank may not pay
any dividends in an amount greater than its undivided profit. Under current
regulatory practice, national banks may pay dividends only out of current
operating earnings. Also, a bank may not declare dividends if such declaration
would leave the bank inadequately capitalized. Therefore, the ability of MBNA
America Bank, N.A. to declare dividends will depend on its future net income and
capital requirements. At June 30, 2000, the amount of retained earnings
available for declaration and payment of dividends from MBNA America Bank, N.A.
to us was $1.8 billion. Payment of dividends by MBNA America Bank, N.A. to us,
however, can be further limited by federal bank regulatory agencies.

     MBNA America Bank, N.A.'s payment of dividends to us may also be limited by
a tangible net worth requirement under our senior syndicated revolving credit
facility. This facility was established in

                                       S-7
<PAGE>   8

April 2000. If this facility had been drawn upon as of June 30, 2000, the amount
of retained earnings available for declaration of dividends would have been
further limited to $590.5 million.

                                  UNDERWRITING

     MBNA Corporation and Goldman, Sachs & Co. ("Goldman Sachs"), as the
underwriter for the offering, have entered into an underwriting agreement with
respect to the shares being offered. Subject to certain conditions, Goldman
Sachs has agreed to purchase all of the shares.

     Goldman Sachs proposes to offer the shares of common stock from time to
time for sale in one or more transactions on the New York Stock Exchange, in the
over-the-counter market, through negotiated transactions or otherwise at market
prices prevailing at the time of the sale, at prices related to prevailing
market prices or at negotiated prices, subject to receipt and acceptance by it
and subject to its right to reject any order in whole or in part. In connection
with the sale of the shares of common stock offered hereby, Goldman Sachs may be
deemed to have received compensation in the form of underwriting discounts.
Goldman Sachs may effect such transactions by selling shares of the common stock
to or through dealers, and such dealers may receive compensation in the form of
discounts, concessions or commissions from Goldman Sachs and/or purchasers of
shares of common stock for whom they may act as agents or to whom they may sell
as principal.

     MBNA Corporation has agreed with Goldman Sachs not to dispose of or hedge
any of its common stock or securities convertible into or exchangeable for
shares of common stock during the period from the date of this Prospectus
Supplement continuing through the date 90 days after the date of this Prospectus
Supplement, except with the prior written consent of Goldman Sachs. This
agreement does not apply to any existing employee benefit plans.

     In connection with the offering, Goldman Sachs may purchase and sell shares
of common stock in the open market. These transactions may include short sales
and purchases to cover positions created by short sales. Short sales involve the
sale by Goldman Sachs of a greater number of shares than it is required to
purchase in the offering. Goldman Sachs does not have an option to purchase
additional shares from MBNA Corporation, and any short sales by Goldman Sachs
will therefore be "naked" short sales. Goldman Sachs must close out any naked
short position by purchasing shares in the open market. A naked short position
is more likely to be created if Goldman Sachs is concerned that there may be
downward pressure on the price of the common stock in the open market after
pricing that could adversely affect investors who purchase in the offering.

     Purchases to cover a short position may have the effect of preventing or
retarding a decline in the market price of MBNA Corporation's common stock and
may stabilize, maintain or otherwise affect the market price of the common
stock. As a result, the price of the common stock may be higher than the price
that otherwise might exist in the open market. If these activities are
commenced, they may be discontinued by Goldman Sachs at any time. These
transactions may be effected on the NYSE, in the over-the-counter market or
otherwise.

     MBNA Corporation estimates that its share of the total expenses of the
offering will be approximately $350,000.

     MBNA Corporation has agreed to indemnify Goldman Sachs against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.

     Goldman Sachs has from time to time provided investment banking services to
MBNA Corporation.

                                       S-8
<PAGE>   9

               INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

     The following documents and information previously filed with the
Commission are hereby incorporated by reference in this Prospectus Supplement:

1. MBNA Corporation's Annual Report on Form 10-K for the year ended December 31,
   1999, as amended by Form 10-K/A-1 provided, however, that the information
   referred to in Item 402 (a)(8) of Regulation S-K promulgated by the
   Commission shall not be deemed to be specifically incorporated by reference
   herein.

2. MBNA Corporation's Current Reports on Form 8-K dated January 10, 2000,
   January 31, 2000, February 29, 2000, March 8, 2000, March 28, 2000, March 31,
   2000, April 12, 2000, April 13, 2000, April 30, 2000, May 11, 2000, May 31,
   2000, June 1, 2000, June 23, 2000, June 28, 2000, June 30, 2000, July 12,
   2000, July 20, 2000, and July 31, 2000.

3. MBNA Corporation's Quarterly Reports on Form 10-Q for the quarters ended
   March 31, 2000 and June 30, 2000.

4. The description of MBNA Corporation's common stock contained in its
   registration statement filed on Form 8-A on January 18, 1991 under the
   Exchange Act.

     All documents filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act, after the date of this Prospectus Supplement and prior to the
termination of the offering of the shares of common stock hereby shall be deemed
to be incorporated herein by reference. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus Supplement, the
Prospectus and the Registration Statement of which they are a part to the extent
that a statement contained herein or in any other subsequently filed document
which is also incorporated or deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus Supplement, the Prospectus or such Registration Statement.

     MBNA Corporation undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of the Prospectus Supplement has
been delivered, upon written or oral request of such person, a copy of any or
all of the documents which have been or may be incorporated herein by reference,
other than exhibits to such documents (unless such exhibits are specifically
incorporated by reference to such documents). Requests for such copies should be
directed to MBNA Corporation, Wilmington, Delaware 19884-0131, Attention:
Investor Relations (800) 362-6255.

                          VALIDITY OF THE COMMON STOCK

     The validity of the common stock will be passed upon for MBNA Corporation
by John W. Scheflen, Executive Vice President, General Counsel and Secretary of
the Corporation, and by Simpson Thacher & Bartlett, New York, New York. The
validity of the shares of common stock offered hereby will be passed upon for
Goldman Sachs by Sullivan & Cromwell, New York, New York. Simpson Thacher &
Bartlett and Sullivan & Cromwell each will rely upon the opinion of Mr. Scheflen
with respect to matters of Maryland law and Mr. Scheflen will rely upon the
opinion of Simpson Thacher & Bartlett with respect to matters of New York law.
Mr. Scheflen owns beneficially in excess of 769,000 shares of our common stock,
including options exercisable within sixty days under our stock incentive plans.
Sullivan & Cromwell regularly performs legal services for us.

                                       S-9
<PAGE>   10

<TABLE>
<S>                                                        <C>

$2,500,000,000                                             [MBNA LOGO]
MBNA CORPORATION
</TABLE>

<TABLE>
<S>                                  <C>
-------------------------------

 A security is not a deposit         MBNA Corporation may offer and sell --
 and the securities are not          -- Debt Securities
 insured or guaranteed               -- Preferred Stock
 by the Federal Deposit              -- Common Stock
 Insurance Corporation               -- Warrants
 or any other                        -- Stock Purchase Contracts
 governmental agency.                -- Stock Purchase Units
 This prospectus may be used to      We will provide specific terms of these securities in
 offer and sell securities only      supplements to this prospectus. You should read this
 if accompanied by the               prospectus and any supplements carefully before you
 prospectus supplement for           invest.
 those securities.
-------------------------------
</TABLE>

NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED THESE
SECURITIES OR DETERMINED THAT THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IS
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

                                 April 7, 1999
<PAGE>   11

              IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS
             PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT

     We provide information to you about the securities in three separate
documents that progressively provide more detail:

-  this prospectus, which provides general information, some of which may not
   apply to your securities;
-  the accompanying prospectus supplement, which describes the terms of the
   securities, some of which may not apply to your securities; and
-  a pricing supplement, which describes the specific and final terms of your
   securities.

     IF THE TERMS OF YOUR SECURITIES VARY BETWEEN THE PRICING SUPPLEMENT, THE
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS, YOU SHOULD RELY ON THE
INFORMATION IN THE FOLLOWING ORDER OF PRIORITY:

-  THE PRICING SUPPLEMENT;
-  THE PROSPECTUS SUPPLEMENT; AND
-  THE PROSPECTUS.

     We include cross-references in this prospectus and the accompanying
prospectus supplement to captions in these materials where you can find further
related discussions. The following Table of Contents and the Table of Contents
included in the accompanying prospectus supplement provide the pages on which
these captions are located.

     You can find a listing of the pages where capitalized terms used in this
prospectus are defined under the caption "Index of Terms for Prospectus"
beginning on page 24 in this prospectus.

                            ------------------------

                                        2
<PAGE>   12

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                               Page
                                               ----
<S>                                            <C>
ABOUT THIS PROSPECTUS........................    4

WHERE YOU CAN FIND MORE INFORMATION..........    4

THE COMPANY..................................    5

USE OF PROCEEDS..............................    5

RATIO OF EARNINGS TO FIXED
    CHARGES AND RATIO OF EARNINGS
    TO COMBINED FIXED CHARGES
    AND PREFERRED STOCK DIVIDEND
    REQUIREMENTS.............................    5

REGULATORY MATTERS...........................    6
    General..................................    6
    Dividend Restrictions....................    6
    Holding Company Structure................    7
    Capital Adequacy.........................    7
    FDICIA and FDIC Insurance................    8
    Regulation of the Credit Card Business...    9
    Federal Financial Institutions
      Examination Council....................   10

DESCRIPTION OF DEBT SECURITIES...............   10
    General..................................   11
    Subordination of Subordinated Debt
      Securities.............................   12
    Restriction on Sale or Issuance of Voting
      Stock of the Bank......................   13
    Events of Default........................   14
</TABLE>

<TABLE>
<CAPTION>
                                               Page
                                               ----
<S>                                            <C>
    Defeasance and Covenant Defeasance.......   15
    Modification and Waiver..................   16
    Consolidation, Merger and Sale of
      Assets.................................   17
    Global Debt Securities...................   17
    Concerning the Trustees..................   17

DESCRIPTION OF PREFERRED STOCK...............   18
    General..................................   18
    Rank.....................................   19
    Dividend Rights..........................   19
    Voting Rights............................   19
    Rights Upon Liquidation..................   19
    Redemption...............................   20
    Conversion...............................   20
    Depositary Shares........................   20

DESCRIPTION OF COMMON STOCK..................   22

DESCRIPTION OF WARRANTS......................   23

DESCRIPTION OF STOCK PURCHASE CONTRACTS AND
  STOCK PURCHASE UNITS.......................   23

PLAN OF DISTRIBUTION.........................   24

VALIDITY OF SECURITIES.......................   24

EXPERTS......................................   25

INDEX OF TERMS FOR PROSPECTUS................   26
</TABLE>

                                        3
<PAGE>   13

                             ABOUT THIS PROSPECTUS

     This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission, the "Commission," utilizing a "shelf"
registration process. Under this shelf process, we may from time to time sell
any combination of the securities described in this prospectus in one or more
offerings up to a total dollar amount of $2,500,000,000. This prospectus
provides you with a general description of the securities we may offer. Each
time we sell securities, we will provide a prospectus supplement that will
contain specific information about the terms of that offering. The prospectus
supplement may also add, update or change information contained in this
prospectus. You should read both this prospectus and any prospectus supplement
together with the additional information described under the heading "Where You
Can Find More Information."

     Unless otherwise indicated or unless the context requires otherwise, all
references in this prospectus to "the Company," "we," "us," "our" or similar
references mean MBNA Corporation.

                      WHERE YOU CAN FIND MORE INFORMATION

     We file annual, quarterly and special reports, proxy statements and other
information with the Commission. You may read and copy any document that we file
at the Public Reference Room of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Information on the operation of the Public Reference
Room may be obtained by calling the Commission at 1-800-SEC-0330. You may also
inspect our filings at the regional offices of the Commission located at
Citicorp, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and 7
World Trade Center, New York, New York 10048 or over the Internet at the
Commission's home page at http://www.sec.gov. You can also inspect reports and
other information we file at the offices of the New York Stock Exchange, Inc.,
20 Broad Street, New York, New York 10005.

     This prospectus constitutes part of a Registration Statement on Form S-3
filed with the Commission under the Securities Act of 1933. It omits some of the
information contained in the Registration Statement, and you should refer to the
Registration Statement for further information about us and the securities
offered by this prospectus. Any statement contained in this prospectus
concerning the provisions of any document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission is not necessarily
complete, and in each instance you should refer to the copy of the document
filed.

     The Commission allows us to disclose important information to you by
referring you to documents we have filed or will file with them. The information
"incorporated by reference" is an important part of this prospectus, and
information that we file later with the Commission will automatically update and
supersede previously filed information. We incorporate by reference the
documents listed below and any future filings made with the Commission under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, the
"Exchange Act," until we sell all of the securities:

          1. Our Annual Report on Form 10-K for the year ended December 31,
     1998, provided, however, that the information referred to in Item 402(a)(8)
     of Regulation S-K promulgated by the Commission shall not be deemed to be
     specifically incorporated by reference herein.

          2. Our Current Reports on Form 8-K dated January 4, 1999, January 7,
     1999, January 31, 1999, February 28, 1999, March 25, 1999, March 26, 1999,
     March 29, 1999 and March 31, 1999.

          3. The description of our Common Stock contained in our registration
     statement filed on Form 8-A on January 18, 1991 under the Exchange Act.

     You may request a copy of these filings at no cost, by directing your
request to MBNA Corporation, Wilmington, Delaware 19884-0131, Attention:
Investor Relations (800) 362-6255.

                                        4
<PAGE>   14

                                  THE COMPANY

     We are a registered bank holding company incorporated under the laws of
Maryland in 1990. We are the parent corporation of MBNA America Bank, National
Association, the "Bank," a national bank organized in January 1991, as the
successor to a national bank organized in 1982.

     Our principal executive offices are located in Wilmington, Delaware 19884,
and our telephone number is (800) 362-6255.

                                USE OF PROCEEDS

     Unless otherwise indicated in the applicable prospectus supplement, the net
proceeds from the sale of the securities offered by this prospectus and the
applicable prospectus supplement will be used for general corporate purposes.
General corporate purposes may include the repayment of maturing debt, possible
acquisitions, investments in, or extension of credit to, our subsidiaries and
the possible acquisition of real property for use in our business.

                     RATIO OF EARNINGS TO FIXED CHARGES AND
                  RATIO OF EARNINGS TO COMBINED FIXED CHARGES
                   AND PREFERRED STOCK DIVIDEND REQUIREMENTS

     Our consolidated ratio of earnings to fixed charges and our ratio of
earnings to combined fixed charges and preferred stock dividend requirements are
as follows:

<TABLE>
<CAPTION>
                                                                  YEAR ENDED DECEMBER 31,
                                                              --------------------------------
                                                              1998   1997   1996   1995   1994
                                                              ----   ----   ----   ----   ----
<S>                                                           <C>    <C>    <C>    <C>    <C>
EARNINGS TO FIXED CHARGES:
  Including Interest on Deposits............................  2.0    2.0    2.0    2.0    2.4
  Excluding Interest on Deposits............................  4.0    4.0    4.2    4.4    5.7
EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK
  DIVIDEND REQUIREMENTS (a):
  Including Interest on Deposits............................  2.0    1.9    1.9    2.0    2.4
  Excluding Interest on Deposits............................  3.8    3.6    3.8    4.3    5.7
</TABLE>

-------------------------
(a) Preferred stock dividend requirements are adjusted to represent a pretax
    earnings equivalent.

     The ratio of earnings to fixed charges is computed by dividing income
before income taxes and fixed charges less interest capitalized during the
period, net of amortization of previously capitalized interest, by fixed
charges. The ratio of earnings to combined fixed charges and preferred stock
dividend requirements is computed by dividing income before income taxes and
fixed charges less interest capitalized during the period, net of amortization
of previously capitalized interest, by fixed charges and preferred stock
dividend requirements. Fixed charges consist of interest, expensed or
capitalized, on borrowings (including or excluding deposits, as applicable), and
the portion of rental expense which is deemed representative of interest. The
preferred stock dividend requirements represent the pretax earnings which would
have been required to cover the dividend requirements on any preferred stock
outstanding. We did not have any preferred stock outstanding during the period
prior to 1995 presented above and accordingly there were no preferred stock
dividend requirements during this period.

                                        5
<PAGE>   15

                               REGULATORY MATTERS

     THE FOLLOWING DISCUSSION DESCRIBES CERTAIN OF THE ELEMENTS OF THE
COMPREHENSIVE REGULATORY FRAMEWORK APPLICABLE TO BANK HOLDING COMPANIES AND
BANKS AND PROVIDES CERTAIN SPECIFIC INFORMATION RELEVANT TO US AND OUR
SUBSIDIARIES. FEDERAL REGULATION OF FINANCIAL INSTITUTIONS SUCH AS THE COMPANY
AND THE BANK IS INTENDED PRIMARILY FOR THE PROTECTION OF DEPOSITORS AND THE BANK
INSURANCE FUND RATHER THAN SHAREHOLDERS OR OTHER CREDITORS.

GENERAL

     As a bank holding company, we are subject to the supervision of the Board
of Governors of the Federal Reserve System, the "Federal Reserve Board." The
Bank is subject to supervision and examination by applicable federal agencies,
principally the Office of the Comptroller of the Currency, the "OCC," which is
the Bank's primary regulator. The Bank's deposits are insured by, and therefore
the Bank is also subject to the regulations of, the Federal Deposit Insurance
Corporation, the "FDIC." In addition to the impact of regulation, commercial
banks are affected significantly by the actions of the Federal Reserve Board as
it attempts to control the money supply and credit availability in order to
influence the economy.

     As a bank holding company, we are also subject to regulation under the Bank
Holding Company Act of 1956, the "BHCA," and to the BHCA's examination and
reporting requirements. Under the BHCA, bank holding companies must, in some
cases, obtain the approval of the Federal Reserve Board prior to acquiring
direct or indirect ownership or control of more than five percent of the voting
shares or substantially all of the assets of any company, including a bank. In
addition, bank holding companies are prohibited under the BHCA from engaging in
nonbanking activities other than those that the Federal Reserve Board has
determined are closely related to banking.

     The earnings of the Bank, and therefore our earnings, are affected by
general economic conditions, management policies and the legislative and
governmental actions of various regulatory authorities, including the Federal
Reserve Board, the FDIC and the OCC. In addition, there are numerous
governmental requirements and regulations which affect our activities.

DIVIDEND RESTRICTIONS

     We are a legal entity separate and distinct from our banking and other
subsidiaries. The principal source of our cash flow, including cash flow to pay
dividends on our stock or principal (premium, if any) and interest on debt
securities, is dividends from the Bank. The approval of the OCC is required for
any dividend paid or declared by a national bank if the total of all dividends
paid or declared by the Bank in any calendar year would exceed the total of its
net income for that year combined with its retained net income for the preceding
two years less any required transfers to surplus or a fund for the retirement of
any preferred stock. In addition, a national bank may not pay a dividend in an
amount greater than its undivided profits. Under current regulatory practice,
national banks may pay dividends only out of current operating earnings. The
payment of dividends by the Bank may also be affected by other factors, such as
requirements for the maintenance of adequate capital. Under these provisions,
the Bank could have declared, as of December 31, 1998, without obtaining prior
regulatory approval, aggregate dividends of approximately $1.4 billion. The
Bank's payment of dividends to us may also be limited by a tangible net worth
requirement under the Bank's revolving credit facility. This facility was not
drawn upon as of December 31, 1998. If this facility had been drawn upon as of
December 31, 1998, the amount of retained earnings available for declaration of
dividends would have been further limited to $645.9 million.

     In addition, under the Federal Deposit Insurance Corporation Improvement
Act of 1991, "FDICIA," a FDIC-insured depository institution may not make
capital distributions, including the payment of dividends, or pay any management
fees to its holding company if it is undercapitalized or if such payment would

                                        6
<PAGE>   16

cause it to become undercapitalized. See "-- FDICIA and FDIC Insurance."

HOLDING COMPANY STRUCTURE

     The Bank is subject to restrictions under federal law which limit the
transfer of funds by the Bank to us and our nonbanking subsidiaries, whether in
the form of loans, extensions of credit, investments or asset purchases. Any
transfers by the Bank to us or any nonbanking subsidiary are limited in amount
to 10% of the Bank's capital and surplus and, with respect to us and all
nonbanking subsidiaries, to an aggregate of 20% of the Bank's capital and
surplus. Furthermore, loans and extensions of credit by the Bank to us or any of
our nonbanking subsidiaries are required to be secured in specified amounts.

     Extensions of credit and other transactions between the Bank and us must be
on terms and under circumstances, including credit standards, that are
substantially the same or at least as favorable to the Bank as those prevailing
at the time for comparable transactions with non-affiliated companies.

     Under Federal Reserve Board policy, we are expected to act as a source of
financial strength to each of our subsidiary banks and to commit resources to
support each subsidiary bank, in circumstances where we might not do so absent
such policy. Any capital loans by us to a subsidiary bank would also be
subordinate in right of payment to deposits and to certain other indebtedness of
that bank. In addition, the Crime Control Act of 1990 provides that in the event
of a bank holding company's bankruptcy, any commitment by the bank holding
company to a federal bank regulatory agency to maintain the capital of a
subsidiary bank will be assumed by the bankruptcy trustee and entitled to a
priority of payment.

     Federal law permits the OCC to order the pro rata assessment of
shareholders of a national bank whose capital stock has become impaired, by
losses or otherwise, to relieve a deficiency in such national bank's capital
stock. The statute also provides for the enforcement of any such pro rata
assessment of shareholders of such national bank to cover such impairment of
capital stock by sale, to the extent necessary, of the capital stock of any
assessed shareholder failing to pay the assessment. We, as the sole stockholder
of the Bank, are subject to such provisions.

CAPITAL ADEQUACY

     We are subject to risk-based capital guidelines adopted by the Federal
Reserve Board for bank holding companies. The Bank is also subject to similar
capital requirements adopted by the OCC. Under these requirements, the federal
bank regulatory agencies have established quantitative measures to ensure that
minimum thresholds for Tier 1 Capital, Total Capital and Leverage ratios are
maintained. Failure to meet these minimum capital requirements can initiate
certain mandatory, and possible additional discretionary, actions by the federal
bank regulators, that, if undertaken, could have a direct material effect on the
Company's and the Bank's financial statements. Under the capital adequacy
guidelines and the regulatory framework for prompt corrective action, the
Company and the Bank must meet specific capital guidelines that involve
quantitative measures of their assets, liabilities, and certain off-balance
sheet items as calculated under regulatory accounting practices.

     The Company's and the Bank's capital amounts and classification are also
subject to qualitative judgments by the federal bank regulators about
components, risk weightings, and other factors. At December 31, 1998, the
Company's and the Bank's capital exceeded all minimum regulatory requirements to
which they are subject, and the Bank was "well-capitalized" as defined under the
federal bank regulatory guidelines. The risked-based capital ratios in the
following table have been computed in accordance with regulatory accounting
practices.

                                        7
<PAGE>   17

                           REGULATORY CAPITAL RATIOS
                              AT DECEMBER 31, 1998

<TABLE>
<CAPTION>
                                                                                    WELL-
                                                                    MINIMUM      CAPITALIZED
                                                         RATIOS   REQUIREMENTS   REQUIREMENTS
                                                         ------   ------------   ------------
<S>                                                      <C>      <C>            <C>
MBNA CORPORATION
  Tier 1...............................................  11.44%       4.00%        (a)
  Total................................................  13.96        8.00         (a)
  Leverage.............................................  11.34        4.00         (a)
MBNA AMERICA BANK, N.A.
  Tier 1...............................................  11.69%       4.00%          6.00%
  Total................................................  14.28        8.00          10.00
  Leverage.............................................  11.55        4.00           5.00
</TABLE>

-------------------------
(a) Not applicable for bank holding companies.

     On November 20, 1997, the OCC, the Federal Reserve Board, the FDIC and the
Office of Thrift Supervision proposed for comment regulations establishing new
risk-based capital requirements for recourse arrangements and direct credit
substitutes. "Recourse" for this purpose means any retained risk of loss
associated with any transferred asset that exceeds a pro rata share of the
bank's or holding company's remaining claim on the asset, if any. Under existing
regulations, banks and bank holding companies have to maintain capital against
the full amount of any assets for which risk of loss is retained, unless the
resulting capital amount would exceed the maximum contractual liability or
exposure retained, in which case the capital required would equal,
dollar-for-dollar, such maximum contractual liability or exposure. The proposal
would extend this treatment to direct credit substitutes. "Direct credit
substitute" means any assumed risk of loss associated with any asset or other
claim that exceeds the bank's or holding company's pro rata share of the asset
or claim, if any.

     One aspect of the proposal specifically addresses securitizations and would
base the capital charge for these transactions on credit ratings from nationally
recognized statistical rating agencies.

FDICIA AND FDIC INSURANCE

     FDICIA provides for expanded regulation of banks and bank holding
companies. The expanded regulation includes expanded federal banking agency
examinations and increased powers of federal banking agencies to take corrective
action to resolve the problems of insured depository institutions with capital
deficiencies. Those powers vary depending on which of several levels of
capitalization a particular institution meets. FDICIA establishes five capital
tiers: well-capitalized, adequately capitalized, undercapitalized, significantly
undercapitalized and critically undercapitalized.

     FDICIA permits only "well capitalized" institutions to accept brokered
deposits without restrictions. As of December 31, 1998 the Bank met the FDIC's
definition of a well capitalized institution for purposes of accepting brokered
deposits. For the purposes of the brokered deposit rules, a bank is defined to
be "well capitalized" if it maintains a ratio of Tier 1 capital to risk-adjusted
assets of at least 6.0%, a ratio of Total capital to risk-adjusted assets of at
least 10.0% and a leverage ratio of at least 5.0% and is not subject to any
order, direction or written agreement to maintain specific capital levels. Under
the regulatory definition of brokered deposits, as of December 31, 1998 the Bank
had brokered deposits of $3.4 billion.

     The Bank is subject to FDIC deposit insurance assessments for the Bank
Insurance Fund, the "BIF." Each financial institution is assigned to one of
three capital groups -- well capitalized, adequately capitalized or
undercapitalized -- and further assigned to one of three

                                        8
<PAGE>   18

subgroups within a capital group, on the basis of supervisory evaluations by the
institution's primary federal and, if applicable, state supervisors and other
information relevant to the institution's financial condition and the risk posed
to the applicable insurance fund. The assessment rate applicable to the Bank in
the future will depend in part upon the risk assessment classification assigned
to the Bank by the FDIC and in part on the BIF assessment schedule adopted by
the FDIC. The Deposit Insurance Funds Act of 1996, "DIFA," provides that
premiums related to deposits assessed by the BIF are to be assessed at a rate of
between 0 cents and 27 cents per $100 of deposits.

     DIFA also separated, effective January 1, 1997, the Financing Corporation,
"FICO," assessment to service the interest on its bond obligations from the BIF
and the Savings Association Insurance Fund, "SAIF," assessments. The amount
assessed on individual institutions by the FICO will be in addition to the
amount, if any, paid for deposit insurance according to the FDIC's risk-related
assessment rate schedules. FICO assessment rates for the second quarter of 1999
were set at 1.176 basis points annually for BIF-assessable deposits. The rate
may be adjusted quarterly to reflect a change in assessment base for the BIF. By
law, the FICO rate on BIF-assessable deposits must be one-fifth the rate on
SAIF-assessable deposits until the insurance funds are merged or until January
1, 2000, whichever occurs first.

REGULATION OF THE CREDIT CARD BUSINESS

     The relationship between the Bank and its cardholders is extensively
regulated by federal and state consumer protection laws. The Truth in Lending
Act requires credit card issuers to make certain disclosures along with their
applications and solicitations, upon opening an account and with each periodic
statement. The Truth in Lending Act also imposes certain substantive
requirements and restrictions on credit card issuers and provides cardholders
with certain rights to dispute unauthorized charges and to have their billing
errors corrected promptly. Cardholders are also given the right to have their
payments promptly credited to their accounts.

     The Equal Credit Opportunity Act prohibits lenders from making credit
decisions based on sex, race and marital status among others. In order to
protect borrowers from such discrimination, the Equal Credit Opportunity Act
requires credit card issuers to disclose the principal reasons they took adverse
action against an applicant or a cardholder.

     The Fair Credit Reporting Act generally regulates credit reporting
agencies, but also imposes some duties on credit card issuers as users of
consumer credit reports. For instance, the Fair Credit Reporting Act prohibits
the use of a consumer credit report by a credit card issuer except in connection
with a proposed business transaction with the consumer. The Fair Credit
Reporting Act also requires that credit card issuers notify consumers when they
take adverse action based upon information obtained from credit reporting
agencies.

     The federal regulators are authorized to impose penalties for violations of
these statutes and, in certain cases, to order the Bank to pay restitution to
injured cardholders. Cardholders may bring actions for damages for such
violations. In addition, a cardholder may be entitled to assert a violation of
these consumer protection laws by way of set-off against his obligation to pay
the outstanding credit card balance.

     In May, 1996, Andrew B. Spark filed a lawsuit against the Company, the Bank
and certain of its officers and its subsidiary, MBNA Marketing Systems, Inc. The
case is pending in the United States District Court for the District of
Delaware. This suit is a purported class action. The plaintiff alleges that the
Bank's advertising of its cash promotional annual percentage rate program was
fraudulent and deceptive. The plaintiff seeks unspecified damages including
actual, treble and punitive damages and attorneys' fees for an alleged breach of
contract, violation of the Delaware Deceptive Trade Practices Act and the
federal Racketeer Influenced and Corrupt Organizations Act. In February, 1998, a
class was certified. The Company believes its advertising practices are

                                        9
<PAGE>   19

proper under applicable federal and state law and intends to defend the action
vigorously. In October 1998, Gerald D. Broder filed a lawsuit against the
Company and the Bank in the Supreme Court of the State of New York, County of
New York. This suit is a purported class action. The plaintiff alleges that the
Bank's advertising of its cash promotional annual percentage rate program was
fraudulent and deceptive. The plaintiff seeks unspecified damages including
actual, treble and punitive damages and attorneys fees for an alleged breach of
contract, common law fraud and violation of New York consumer protection
statutes. The Company believes that its advertising practices are proper under
applicable federal and state law and intends to defend these actions vigorously.

FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

     In February 1999, the Federal Financial Institutions Examination Council
published a revised policy statement on the classification of consumer loans.
The revised policy establishes uniform guidelines for charge-off of loans to
delinquent, bankrupt, and deceased borrowers, for charge-off of fraudulent
accounts, and for re-aging, extending, deferring or rewriting delinquent
accounts. The guidelines must be implemented by June 30, 1999, unless
programming resources are required, in which case they must be implemented by
December 31, 2000. We will accelerate charge-off of some delinquent loans when
we implement the guidelines but we do not expect implementation to have a
material effect on our consolidated financial statements.

                         DESCRIPTION OF DEBT SECURITIES

     We may from time to time offer and sell debt securities, consisting of
debentures, notes and/or other unsecured evidences of indebtedness, the "Debt
Securities." The Debt Securities will be either our unsecured senior debt
securities, the "Senior Debt Securities," or our unsecured subordinated debt
securities, the "Subordinated Debt Securities." The Senior Debt Securities will
be issued under an Indenture, the "Senior Indenture," between us and Bankers
Trust Company, as Trustee, the "Senior Trustee." The Subordinated Debt
Securities are to be issued under a second Indenture, the "Subordinated
Indenture," between us and Harris Trust and Savings Bank, as Trustee, the
"Subordinated Trustee." The Senior Indenture and the Subordinated Indenture are
together called the "Indentures" and the Senior Trustee and the Subordinated
Trustee are together called the "Trustees."

     The following summary of certain provisions of the Indentures is not
complete. You should refer to the Indentures, copies of which are exhibits to
the registration statement of which this prospectus is a part, Registration
Statement File No. 333-74919; the "Registration Statement." Section references
below are to the section in the applicable Indenture. Capitalized terms have the
meanings assigned to them in the applicable Indenture. The referenced sections
of the Indentures and the definitions of capitalized terms are incorporated by
reference.

     The following sets forth certain general terms and provisions of the Debt
Securities. The particular terms of the Debt Securities offered by any
prospectus supplement will be described in the prospectus supplement relating to
the offered Debt Securities.

     We are a bank holding company, and our right to participate as a
shareholder in any distribution of assets of any subsidiary upon its liquidation
or reorganization or winding-up is subject to the prior claims of creditors of
any subsidiary. Consequently, the ability of the holders of the Debt Securities
to benefit, as our creditors, from any distributions is also subject to these
prior claims. The Bank is subject to claims by creditors for long-term and
short-term debt obligations, including deposit liabilities, obligations for
federal funds purchased and securities sold under repurchase agreements. There
are also various legal limitations on the extent to which the Bank may pay
dividends or

                                       10
<PAGE>   20

otherwise supply funds to us or our affiliates. See "Regulatory Matters."

GENERAL

     The Indentures do not limit the amount of Debt Securities that we may
issue. Each Indenture provides that Debt Securities may be issued from time to
time in one or more series. The Debt Securities will be our unsecured
obligations.

     The Indentures and the Debt Securities do not contain any provisions that
would limit our ability or the ability of our subsidiaries to incur
indebtedness, that would require us or an acquiror to repurchase Debt Securities
in the event of a "change in control" or that would afford holders of Debt
Securities protection in the event of a highly leveraged or similar transaction
involving us or our subsidiaries. You should read the applicable prospectus
supplement for information with respect to any deletions from, modifications of
or additions to the events of default or covenants described below that are
applicable to the Debt Securities.

     Unless otherwise indicated in the applicable prospectus supplement,
principal of, premium, if any, and interest on the Debt Securities will be
payable at our office or agency in the Borough of Manhattan, The City of New
York, provided that, at our option, interest may be paid by mailing a check to
the address of the person receiving interest as it appears on the register for
the Debt Securities. Transfers of Debt Securities may be made at the same
location. (Sections 301, 305 and 1002) The Debt Securities will be issued only
in fully registered form without coupons and, unless otherwise indicated in the
applicable prospectus supplement, in denominations of $1,000 or integral
multiples thereof. (Section 302) No service charge will be made for any
registration of transfer or exchange of the Debt Securities, but we may require
payment of a sum sufficient to cover any tax or other governmental charge
imposed in connection with the transfer or exchange. (Section 305)

     The prospectus supplement relating to the particular series of Debt
Securities being offered will specify the particular terms of those Debt
Securities. The terms may include:

     - the title and type of the Debt Securities;

     - any limit on the aggregate principal amount of the Debt Securities;

     - the date or dates on which the principal of the Debt Securities will
       mature;

     - the interest rate or rates, which may be fixed or variable, of the Debt
       Securities, if any, and the date or dates from which any interest will
       accrue;

     - the interest payment dates and the regular record dates for the interest
       payment dates;

     - the place or places where payments may be made on the Debt Securities;

     - any mandatory or optional sinking funds or analogous provisions;

     - the date, if any, after which and the price or prices at which the Debt
       Securities may be redeemed and other detailed terms and provisions of any
       optional or mandatory redemption provision;

     - our obligation, if any, to redeem or repurchase the Debt Securities at
       the option of the holder;

     - if other than denominations of $1,000 and any integral multiple thereof,
       the denominations in which the Debt Securities will be issuable;

     - if other than the principal amount thereof, the portion of the principal
       amount of the Debt Securities that will be payable upon the declaration
       of acceleration of the maturity thereof;

     - the currency of payment of principal of and any premium and interest on
       the Debt Securities;

     - any index used to determine the amount of payment of principal of and any
       premium and interest on the Debt Securities;

     - if the Debt Securities will be issuable only in the form of a Global
       Security,

                                       11
<PAGE>   21

       the Depositary or its nominee with respect to the Debt Securities and the
       circumstances under which the Global Security may be registered for
       transfer or exchange in the name of a person other than the Depositary or
       its nominee;

     - the applicability, if any, of the provisions described under "Defeasance
       and Covenant Defeasance;"

     - any additional event of default, and in the case of any Subordinated Debt
       Securities, any additional event of default that would result in the
       acceleration of the maturity thereof; and

     - any other terms of the Debt Securities. (Section 301)

     Some of the Debt Securities may be issued as original issue discount Debt
Securities. Original issue discount Debt Securities are securities sold by us
for substantially less than their stated principal amount. Federal income tax
consequences and other special considerations applicable to any original issue
discount Debt Securities will be described in the applicable prospectus
supplement. (Section 101)

SUBORDINATION OF SUBORDINATED DEBT SECURITIES

     Unless otherwise indicated in the applicable prospectus supplement, the
following provisions apply to the Subordinated Debt Securities. The following
section references are to sections of the Subordinated Indenture.

     The Subordinated Debt Securities will be subordinated in right of payment
to all Senior Indebtedness, as defined below. In certain events of insolvency,
payments on the Subordinated Debt Securities will also be effectively
subordinated in right of payment to all Other Financial Obligations, as defined
below. In certain circumstances relating to any liquidation, dissolution,
winding up, reorganization, insolvency or similar proceeding of the Company, the
holders of all Senior Indebtedness will first be entitled to receive payment in
full before the holders of the Subordinated Debt Securities will be entitled to
receive any payment in respect of the Subordinated Debt Securities. (Section
1302) If, after all payments have been made to the holders of Senior
Indebtedness, (A) there are amounts available for payment on the Subordinated
Debt Securities and (B) any person entitled to payment according to the terms of
Other Financial Obligations has not received full payment, then amounts
available for payments on the Subordinated Debt Securities will first be used to
pay in full such Other Financial Obligations before any payment may be made on
the Subordinated Debt Securities.

     In the event of the acceleration of the maturity of any Subordinated Debt
Securities, all Senior Indebtedness will have to be repaid before any payment
can be made on the Subordinated Debt Securities. (Section 1303) No payments on
the Subordinated Debt Securities may be made in the event:

     - there is a default in any payment with respect to any Senior
       Indebtedness, or an event of default with respect to any Senior
       Indebtedness permitting the holders thereof to accelerate the maturity of
       the Senior Indebtedness, or

     - if there is pending any judicial proceeding with respect to any default.
       (Section 1304)

     By reason of the subordination, in the event of our insolvency, our
creditors who are not holders of Senior Indebtedness or the Subordinated Debt
Securities may recover less, proportionately, than holders of Senior
Indebtedness and may recover more, proportionately, than holders of the
Subordinated Debt Securities.

     "Senior Indebtedness" is defined in the Subordinated Indenture to mean the
principal of, premium, if any, and interest on (A) all indebtedness for money
borrowed by us, including indebtedness of others that we guarantee, other than
the Subordinated Debt Securities, whether outstanding on the date of the
Subordinated Indenture or created, assumed or incurred after that date and (B)
any amendments, renewals, extensions, modifications and refundings of any
indebtedness, unless in either case

                                       12
<PAGE>   22

the instrument evidencing any indebtedness provides that the indebtedness is not
superior in right of payment to the Subordinated Debt Securities. (Section 101)
For the purposes of this definition, "indebtedness for money borrowed" is
defined as:

     - any obligation of ours or any obligation guaranteed by us for the
       repayment of borrowed money, whether or not evidenced by bonds,
       debentures, notes or other written instruments;

     - any deferred payment obligation of ours or any such obligation guaranteed
       by us for the payment of the purchase price of property or assets
       evidenced by a note or similar instrument; and

     - any obligation of ours or any such obligation guaranteed by us for the
       payment of rent or other amounts under a lease of property or assets
       which obligation is required to be classified and accounted for as a
       capitalized lease on our balance sheet under generally accepted
       accounting principles.

     "Other Financial Obligations" is defined in the Subordinated Indenture to
mean all of our obligations to make payment pursuant to the terms of financial
instruments, such as:

     - securities contracts and foreign currency exchange contracts;

     - derivative instruments, such as swap agreements (including interest rate
       and currency and foreign exchange rate swap agreements), cap agreements,
       floor agreements, collar agreements, interest rate agreements, foreign
       exchange agreements, options, commodity futures contracts and commodity
       options contracts; and

     - in the case of the instruments described above, similar financial
       instruments other than obligations on account of Senior Indebtedness and
       obligations on account of indebtedness for money borrowed ranking equal
       or subordinate to the Subordinated Debt Securities. (Section 101)

     The Subordinated Indenture does not limit the amount of other indebtedness
that we or any of our subsidiaries may issue. As of December 31, 1998, the
aggregate principal amount of Senior Indebtedness we had outstanding was $2.1
billion.

RESTRICTION ON SALE OR ISSUANCE OF VOTING STOCK OF THE BANK

     The Senior Indenture contains a covenant by us that neither we nor any
subsidiary will sell, assign, transfer, grant a security interest or otherwise
dispose of any shares of voting stock, or any securities convertible into, or
options, warrants or rights to purchase shares of voting stock of the Bank or
any subsidiary owning any shares of the Bank. In addition, we will not permit
the Bank or any subsidiary owning any shares of voting stock of the Bank to
issue any shares of the Bank's Voting Stock or any securities convertible into,
or options, warrants or rights to purchase shares of the Bank's voting stock.
These restrictions will not apply to sales, assignments, transfers, issuances,
grants of security interests or other dispositions which:

     - are for fair market value, as determined by our Board of Directors, and
       if, after giving effect to the transaction, we will own not less than 80%
       of the shares of voting stock of the Bank or any such subsidiary owning
       any shares of voting stock of the Bank free and clear of any security
       interest;

     - are made (x) in compliance with an order of a court or regulatory
       authority of competent jurisdiction, or (y) in compliance with a
       condition imposed by any court or authority permitting us to acquire any
       other bank or entity the activities of which are legally permissible for
       us or any subsidiary to engage in, or (z) in compliance with an
       undertaking made to such an authority in connection with an acquisition
       by us of any bank or entity the activities of which are legally
       permissible for us or any subsidiary to engage in, provided that, in the
       case of clauses (y) and (z), the assets of the bank or entity being
       acquired and its

                                       13
<PAGE>   23

       consolidated subsidiaries equal or exceed 75% of the assets of the Bank
       or any subsidiary owning any shares of voting stock of the Bank and its
       respective consolidated subsidiaries on the date of acquisition; or

     - are made to us or to any wholly-owned subsidiary.

Notwithstanding the restrictions described above, the Bank may be merged into or
consolidated with another banking institution organized under the laws of the
United States, any State or the District of Columbia, if, after giving effect to
the merger or consolidation, we or any wholly-owned subsidiary owns at least 80%
of the voting stock of the other banking institution then issued and outstanding
free and clear of any security interest and if, immediately after giving effect
to the merger or consolidation, no event of default exists. (Section 1008) This
restriction is not included in the Subordinated Indenture.

EVENTS OF DEFAULT

     Unless otherwise provided in the applicable prospectus supplement, the
Indentures define an event of default as any one of the following events:

     - default in the payment of any interest upon any Debt Security and
       continuance of that default for a period of 30 days (in the case of the
       Subordinated Indenture, whether or not payment is prohibited by the
       subordination provisions);

     - default in the payment of the principal of (or premium, if any, on) any
       Debt Security at its maturity (in the case of the Subordinated Indenture,
       whether or not payment is prohibited by the subordination provisions);

     - failure to deposit any sinking fund payment (in the case of the
       Subordinated Indenture, whether or not payment is prohibited by the
       subordination provisions);

     - our failure to perform any other covenants or warranties in the
       applicable Indenture, other than a covenant or warranty included in the
       applicable Indenture solely for the benefit of a series of Debt
       Securities under the applicable Indenture other than that series,
       continuing for 60 days after the holders of at least 25% in principal
       amount of the outstanding Debt Securities have given written notice;

     - our failure, or the Bank's failure, to pay the principal of, or
       acceleration of, any indebtedness for borrowed money in an aggregate
       principal amount exceeding $10,000,000, if the acceleration is not
       annulled within 10 days after due notice;

     - certain events relating to our or the Bank's bankruptcy, insolvency or
       reorganization, and

     - any other event of default provided with respect to Debt Securities of
       that series. (Section 501)

If an event of default occurs with respect to the Debt Securities, the Trustee
under the applicable Indenture will give the holders of the Debt Securities
notice of the default. However, if we fail to perform certain covenants or
warranties in the applicable Indenture, the Trustee will not give notice to
holders until at least 30 days after the 60-day cure period has expired.
(Section 602)

     If any event of default with respect to the Senior Debt Securities of any
series occurs and is continuing, either the Trustee or the holders of at least
25% in aggregate principal amount of the outstanding Debt Securities of that
series may declare the principal amount or, if the Debt Securities of that
series are original issue discount Debt Securities, a specified portion of the
principal amount of all the Senior Debt Securities of that series to be due and
payable immediately. The Trustee and the holders will not be entitled to
accelerate the maturity of the Subordinated Debt Securities upon the occurrence
of any of the events of default described above except in the case of certain
events relating to our bankruptcy, insolvency or reorganization. There is no
right of acceleration in the case of a default in the performance of any

                                       14
<PAGE>   24

covenant with respect to the Subordinated Debt Securities, including the payment
of interest or principal. At any time after a declaration of acceleration with
respect to Debt Securities of any series has been made, but before a judgment or
decree based on acceleration has been obtained, the holders of a majority in
aggregate principal amount of outstanding Debt Securities of that series may,
under certain circumstances, rescind and annul the acceleration. (Section 502)

     The Indentures provide that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the holders, unless the holders have offered
reasonable indemnity to the Trustee. (Section 603) Subject to the provisions for
the indemnification of the Trustee and to certain other conditions, the holders
of a majority in aggregate principal amount of the outstanding Debt Securities
of any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Debt Securities
of that series. (Section 512)

     No holder of any series of Debt Securities will have any right to institute
any proceeding with respect to the applicable Indenture or for the appointment
of a receiver or a trustee or for any remedy under the applicable Indenture,
unless:

     - the holder will have previously given to the Trustee written notice of a
       continuing event of default;

     - the holders of at least 25% in aggregate principal amount of the
       outstanding Debt Securities of that series will have made written
       request, and offered reasonable indemnity, to the Trustee to institute
       the proceeding as trustee; and

     - the Trustee will not have received from the holders of a majority in
       aggregate principal amount of the outstanding Debt Securities of that
       series a direction inconsistent with the request and will have failed to
       institute the proceeding within 60 days. (Section 507)

     However, these limitations do not apply to a suit instituted by a holder of
a Debt Security for enforcement of payment of the principal of and premium, if
any, or interest on the Debt Security on or after the respective due dates
expressed in the Debt Security. (Section 508)

     We are required under each Indenture to furnish to the Trustee annually a
statement as to our performance of certain obligations under the Indenture and
as to any default in the performance. (Section 1004)

DEFEASANCE AND COVENANT DEFEASANCE

     The Indentures provide, if the provision is made applicable to the Debt
Securities of any series pursuant to Section 301 of the applicable Indenture,
which will be indicated in the applicable prospectus supplement, that we may
elect either (a) to defease and be discharged from all obligations relating to
the Debt Securities then outstanding, including, in the case of Subordinated
Debt Securities, the provisions described under "Subordination of Subordinated
Debt Securities" and except for certain obligations to register the transfer of
or exchange of the Debt Securities, replace stolen, lost or mutilated Debt
Securities, maintain paying agencies and hold monies for payment in trust,
referred to as "defeasance," or (b) to be released from our obligations with
respect to the Debt Securities under any covenant applicable to the Debt
Securities which is determined pursuant to Section 301 of the applicable
Indenture to be subject to covenant defeasance and, with respect to Senior Debt
Securities, to be released from our obligations concerning the restriction on
sale or issuance of voting stock described under "Restriction on Sale or
Issuance of voting stock of the Bank," referred to as "covenant defeasance," and
the occurrence of an event described in the fourth item regarding covenants
subject to covenant defeasance or the fifth item listed under "Events of
Default" above will no longer be an event of default, in each case (a) or (b),
if we deposit, in trust,

                                       15
<PAGE>   25

with the Trustee under the applicable Indenture, money or U.S. Government
Obligations, which through the payment of interest and principal in accordance
with their terms will provide money, in an amount sufficient, without
reinvestment, to pay all the principal of (and premium, if any) and interest on
such Debt Securities on the dates such payments are due, which may include one
or more redemption dates designated by us, and any mandatory sinking fund or
analogous payments in accordance with the terms of the Debt Securities. This
trust may only be established if, among other things:

     - no event of default or event which with the giving of notice or lapse of
       time, or both, would become an event of default under the Indenture will
       have occurred and be continuing on the date of the deposit;

     - the deposit will not cause the Trustee under the applicable Indenture to
       have any conflicting interest with respect to our other securities;

     - we will have delivered an opinion of counsel to the effect that the
       holders will not recognize income, gain or loss for Federal income tax
       purposes as a result of the deposit or defeasance and will be subject to
       Federal income tax in the same manner as if the defeasance had not
       occurred; and

     - in the case of Subordinated Debt Securities, no default in the payment of
       principal of any Senior Indebtedness will have occurred or be continuing
       and no other event of default with respect to any Senior Indebtedness
       will have occurred and be continuing, permitting, after notice or lapse
       of time or both, the acceleration thereof.

     We may exercise our defeasance option with respect to the Debt Securities
notwithstanding our prior exercise of our covenant defeasance option. If we
exercise our defeasance option, payment of the Debt Securities may not be
accelerated because of an event of default. If we exercise our covenant
defeasance option, payment of the Debt Securities may not be accelerated by
reference to the covenants noted under clause (b) under the caption "Defeasance
and Covenant Defeasance" above. In the event we fail to comply with our
remaining obligations with respect to the Debt Securities under the applicable
Indenture after exercising our covenant defeasance option and the Debt
Securities are declared due and payable because of the occurrence of any event
of default, the amount of money and U.S. Government Obligations on deposit with
the Trustee may be insufficient to pay amounts due on the Debt Securities of
such series at the time of the acceleration resulting from the event of default.
However, we will remain liable for these payments. (Article Thirteen and Article
Fourteen of the Senior Indenture and the Subordinated Indenture, respectively.)

MODIFICATION AND WAIVER

     We and the Trustee under the applicable Indenture may make modifications
and amendments to the Indentures with the consent of the holders of not less
than 66 2/3% in aggregate principal amount of the outstanding Debt Securities of
each series issued under the Indenture and affected by the modification or
amendments. However, no modification or amendment may, without the consent of
each holder of Debt Securities affected by the modification or amendment:

     - change the stated maturity of any Debt Security;

     - reduce the principal amount of, or the premium, if any, or, except as
       otherwise provided in the applicable prospectus supplement, interest on,
       any Debt Security, including in the case of an original issue discount
       Debt Security the amount payable upon acceleration of the maturity of the
       Debt Security;

     - change the place or currency of payment of principal of, premium, if any,
       or interest on any Debt Security;

     - impair the right to institute suit for the enforcement of any payment on
       any

                                       16
<PAGE>   26

       Debt Security on or at the stated maturity, or in the case of redemption,
       on or after the redemption date;

     - in the case of the Subordinated Indenture, modify the subordination
       provisions in a manner adverse to the holders of the Subordinated Debt
       Securities; or

     - reduce the percentage in principal amount of outstanding Debt Securities
       of any series, the consent of whose holders is required for modification
       or amendment of the Indenture or for waiver of certain defaults or, in
       the case of the Senior Indenture, for waiver of compliance with certain
       provisions of the Indenture. (Section 902)

     The holders of at least 66 2/3% in aggregate principal amount of the
outstanding Senior Debt Securities of any series may, on behalf of all holders
of that series, waive our compliance with certain restrictive provisions of the
applicable Indenture. (Section 1009) The holders of a majority in aggregate
principal amount of the Senior Debt Securities or the Subordinated Debt
Securities may, on behalf of all holders of the Senior Debt Securities or the
Subordinated Debt Securities, respectively, waive any past default under the
applicable Indenture, except a default in the payment of principal, premium or
interest or in the performance of certain covenants. (Section 513)

CONSOLIDATION, MERGER AND SALE OF ASSETS

     Under each Indenture, we may consolidate with or merge into any other
corporation or convey, transfer or lease our properties and assets substantially
as an entirety to any person without the consent of the holders of any of the
outstanding Debt Securities provided that:

     - any successor or purchaser is a corporation organized under the laws of
       the United States of America, any State or the District of Columbia, and
       will expressly assume our obligations on the Debt Securities under a
       supplemental Indenture;

     - immediately after giving effect to the transaction no event of default,
       and no event which, after notice or lapse of time or both, would become
       an event of default, will have occurred and be continuing;

     - if our properties or assets become subject to a mortgage, pledge, lien,
       security interest or other encumbrance not permitted by the Indenture, we
       or the successor person takes the necessary steps to secure the
       Securities equally and proportionately with (or prior to) all
       indebtedness secured thereby; and

     - we have delivered to the Trustee under the applicable Indenture an
       officers' certificate and an opinion of counsel stating compliance with
       these provisions. (Section 801)

GLOBAL DEBT SECURITIES

     The Debt Securities of a series may be issued in the form of one or more
Global Securities that will be deposited with a Depositary or its nominee
identified in the applicable prospectus supplement. In such a case, one or more
Global Securities will be issued in a denomination or aggregate denominations
equal to the portion of the aggregate principal amount of outstanding Debt
Securities of the series to be represented by the Global Security or Securities.
Unless and until it is exchanged in whole or in part for Debt Securities in
definitive registered form, a Global Security may not be registered for transfer
or exchange except as a whole by the Depositary for the Global Security to a
nominee for the Depositary and except in the circumstances described in the
applicable prospectus supplement. (Sections 204 and 305)

     The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the applicable prospectus supplement.

CONCERNING THE TRUSTEES

     Bankers Trust Company and Harris Trust and Savings Bank are Trustees under
the Senior

                                       17
<PAGE>   27

Indenture and the Subordinated Indenture, respectively. In the normal course of
business, we and our subsidiaries conduct banking transactions with the
Trustees, and the Trustees conduct banking transactions with us and our
subsidiaries. Bankers Trust Company serves as trustee for several of the trusts
established in connection with certain of the Bank's asset securitizations.

                         DESCRIPTION OF PREFERRED STOCK

     The following summary contains a description of the general terms of the
preferred stock, par value $.01 per share, the "Preferred Stock," to which any
prospectus supplement may relate. Certain terms of any series of the Preferred
Stock offered by any prospectus supplement will be described in the prospectus
supplement for that series of the Preferred Stock. If so indicated in the
prospectus supplement, the terms of that series, including any Depositary
Shares, as defined below, issued in conjunction with Preferred Stock, may differ
from the terms described below. Certain provisions of the Preferred Stock
described below and in any prospectus supplement are not complete. You should
refer to our Articles of Incorporation and the articles supplementary to our
Articles of Incorporation which will be filed with the Commission in connection
with the offering of the series of Preferred Stock.

GENERAL

     Our Articles of Incorporation authorize our Board of Directors or a
committee of our Board of Directors to provide for the issuance of Preferred
Stock in one or more series, without stockholder action. The Board of Directors
can determine the rights, preferences and limitations of each series. Under the
Articles of Incorporation, 20,000,000 shares are classified as Preferred Stock.
Our Board of Directors has authority to reclassify authorized but unissued
shares of any stock as Preferred Stock or other stock having preferred dividend
and voting rights and other characteristics determined by our Board of
Directors. Prior to the issuance of each series of Preferred Stock, our Board of
Directors will adopt resolutions creating and designating the series as a series
of Preferred Stock. As of December 31, 1998, we had outstanding 4,547,882 shares
of 7 1/2% Cumulative Preferred Stock, Series A, and 4,026,000 shares of
Adjustable Rate Cumulative Preferred Stock, Series B.

     The Preferred Stock has the terms described below, unless otherwise
provided in the prospectus supplement relating to a particular series of the
Preferred Stock. You should read the prospectus supplement relating to the
particular series of the Preferred Stock offered thereby for specific terms,
including:

     - the designation of the Preferred Stock and the number of shares offered;

     - the amount of liquidation preference per share;

     - the price at which the Preferred Stock will be issued;

     - the dividend rate, or method of calculation, the dates on which dividends
       will be payable, whether the dividends will be cumulative or
       noncumulative and, if cumulative, the dates from which dividends will
       commence to cumulate;

     - any redemption or sinking fund provisions of the Preferred Stock;

     - whether we have elected to offer Depositary Shares, as defined below; and

     - any additional voting, dividend, liquidation, redemption, sinking fund
       and other rights, preferences, privileges, limitations and restrictions
       of the Preferred Stock.

     The Preferred Stock will, when issued, be fully paid and nonassessable and
have no preemptive rights. Unless otherwise specified in the prospectus
supplement, each series of the Preferred Stock will rank equally as to dividends
and liquidation rights in all respects with each other series of the Preferred
Stock.

                                       18
<PAGE>   28

RANK

     Any series of the Preferred Stock will, with respect to dividend rights and
rights on liquidation, winding up and dissolution, rank:

     - senior to all classes of Common Stock and to all equity securities issued
       by us the terms of which specifically provide that the equity securities
       will rank junior to the Preferred Stock, collectively referred to as the
       "Junior Securities;"

     - equally with all equity securities issued by us the terms of which
       specifically provide that the equity securities will rank equally with
       the Preferred Stock, collectively referred to as the "Parity Securities;"
       and

     - junior to all equity securities issued by us the terms of which
       specifically provide that the equity securities will rank senior to the
       Preferred Stock.

DIVIDEND RIGHTS

     Holders of the Preferred Stock of each series will be entitled to receive,
when, as and if declared by the Board of Directors, cash dividends at the rates
and on the dates described in the prospectus supplement. The rate may be fixed
or variable or both. Each dividend will be payable to the holders of record as
they appear on our stock record books or, if applicable, the records of the
Depositary referred to below under "Depositary Shares," on record dates
determined by the Board of Directors. Dividends on any series of the Preferred
Stock may be cumulative or noncumulative, as provided in the prospectus
supplement. Our ability to pay dividends on our Preferred Stock is subject to
policies established by the Federal Reserve Board. See "Regulatory
Matters -- Dividend Restrictions."

     No full dividends may be declared or paid or funds set apart for the
payment of dividends on any Parity Securities unless dividends have been paid or
set apart for payment on the Preferred Stock. If full dividends are not paid,
the Preferred Stock will share dividends pro rata with the Parity Securities. No
dividends may be declared or paid or funds set apart for the payment of
dividends on any Junior Securities unless full cumulative dividends for all
dividend periods terminating on or prior to the date of the declaration or
payment will have been paid or declared and a sum sufficient for the payment set
apart for payment on the Preferred Stock.

     Each series of Preferred Stock will be entitled to dividends as described
in the prospectus supplement, which may be based upon one or more methods of
determination. Different series of the Preferred Stock may be entitled to
dividends at different rates or based upon different methods of determination.

VOTING RIGHTS

     Except as indicated in the prospectus supplement, or except as expressly
required by applicable law, the holders of the Preferred Stock will not be
entitled to any voting rights.

     Under regulations adopted by the Federal Reserve Board if the holders of
any series of Preferred Stock become entitled to vote for the election of
directors because dividends on that series are in arrears, that series may then
be deemed a "class of voting securities." In such case, a holder of 25% or more
of the series, or a holder of 5% or more if that holder exercises a "controlling
influence" over the Company, may then be subject to regulation as a bank holding
company in accordance with the BHCA. In addition, at such time as the series is
deemed a class of voting securities, (A) any other bank holding company may be
required to obtain the approval of the Federal Reserve Board to acquire or
retain 5% or more of that series and (B) any person other than a bank holding
company may be required to obtain the approval of the Federal Reserve Board to
acquire or retain 10% or more of that series.

RIGHTS UPON LIQUIDATION

     In the event we liquidate, dissolve or wind-up our affairs, either
voluntarily or involuntarily, the holders of each series of Preferred Stock will
be entitled to receive, before any distribution of assets is made to holders of
Junior

                                       19
<PAGE>   29

Securities, including common stock, liquidating distributions in the amount
described in the prospectus supplement relating to each series of the Preferred
Stock, plus an amount equal to accrued and unpaid dividends and, if the series
of the Preferred Stock is cumulative, for all dividend periods prior to that
point in time. If the amounts payable with respect to the Preferred Stock of any
series and any other Parity Securities are not paid in full, the holders of the
Preferred Stock of the applicable series and the Parity Securities will share
proportionately in the distribution of our assets in proportion to the full
liquidation preferences to which they are entitled. After the holders of
Preferred Stock and the Parity Securities are paid in full, they will have no
right or claim to any of our remaining assets.

     Because we are a bank holding company, our rights, the rights of our
creditors and of our stockholders, including the holders of the shares of the
Preferred Stock offered by this prospectus, to participate in the assets of any
subsidiary, upon the subsidiary's liquidation or recapitalization may be subject
to the prior claims of the subsidiary's creditors except to the extent that we
may ourselves be a creditor with recognized claims against the subsidiary.

REDEMPTION

     A series of the Preferred Stock may be redeemable, in whole or in part, at
our option or the option of the holder. In addition, a series of Preferred Stock
may be subject to mandatory redemption pursuant to a sinking fund. The
redemption provisions that may apply to a series of Preferred Stock, including
the redemption dates and the redemption prices for that series, will be
described in the prospectus supplement.

     In the event of partial redemptions of Preferred Stock, whether by
mandatory or optional redemption, the Board of Directors will determine the
method for selecting the shares to be redeemed, which may be by lot or pro rata
or by any other method determined to be equitable.

     On or after a redemption date, unless we default in the payment of the
redemption price, dividends will cease to accrue on shares of Preferred Stock
called for redemption. In addition, all rights of holders of the shares will
terminate except for the right to receive the redemption price.

     Under current regulations, bank holding companies may exercise an option to
redeem shares of preferred stock included as Tier 1 capital, or exchange the
preferred stock for debt securities, without the prior approval of the Federal
Reserve Board, if the bank holding company will remain well capitalized,
received a composite rating of 1 or 2 of its most recent BOPEC inspection and is
not the subject of any unresolved supervisory issues.

CONVERSION

     The prospectus supplement will state the terms, if any, on which shares of
a series of Preferred Stock are convertible into other securities of ours.

DEPOSITARY SHARES

     GENERAL. We may, at our option, elect to offer fractional shares of
Preferred Stock, "Depositary Shares," rather than full shares of Preferred
Stock. If we do, we will issue to the public receipts, "Depositary Receipts,"
for Depositary Shares, each of which will represent a fraction, to be described
in the prospectus supplement, of a share of a particular series of Preferred
Stock.

     The shares of any series of Preferred Stock represented by Depositary
Shares will be deposited under a Deposit Agreement, the "Deposit Agreement,"
between us and the depositary named in the prospectus supplement, the
"Depositary." Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, in proportion to the applicable fractional
interest in shares of Preferred Stock represented by the Depositary Share, to
all the rights and preferences of the Preferred Stock represented by the
Depositary Shares. Those rights include dividend, voting, redemption,
subscription and liquidation rights.

     The following summary of certain provisions of the Deposit Agreement is not
complete

                                       20
<PAGE>   30

and is subject to, and is qualified in its entirety by reference to, all the
provisions of the Deposit Agreement. Whenever particular sections of the Deposit
Agreement are referred to, it is intended that the sections shall be
incorporated by reference in this prospectus. You should read copies of the
forms of Deposit Agreement and Depositary Receipt filed as an exhibit to the
Registration Statement.

     DIVIDENDS AND OTHER DISTRIBUTIONS. The Depositary will distribute all cash
dividends or other cash distributions received in respect of the Preferred Stock
to the record holders of Depositary Shares relating to that Preferred Stock in
proportion to the number of Depositary Shares owned by those holders. (Section
4.01)

     If there is a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares in
an equitable manner, unless the Depositary determines that it is not feasible to
make the distribution. If this occurs, the Depositary may sell the property and
distribute the net proceeds for the sale to the applicable holders. (Section
4.02)

     REDEMPTION OF DEPOSITARY SHARES. If a series of Preferred Stock represented
by Depositary Shares is subject to redemption, the Depositary Shares will be
redeemed from the proceeds received by the Depositary resulting from the
redemption, in whole or in part, of that series of Preferred Stock held by the
Depositary. The redemption price per Depositary Share will be equal to the
applicable fraction of the redemption price per share payable with respect to
that series of the Preferred Stock. Whenever we redeem shares of Preferred Stock
held by the Depositary, the Depositary will redeem, as of the same redemption
date, the number of Depositary Shares representing shares of Preferred Stock so
redeemed. If fewer than all the Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed will be selected by lot, pro rata or by any
other equitable method as determined by the Depositary. (Section 2.08)

     VOTING THE PREFERRED STOCK. Upon receipt of notice of any meeting at which
the holders of the Preferred Stock are entitled to vote, the Depositary will
mail the information contained in the notice of meeting to the record holders of
the Depositary Shares relating to the Preferred Stock. Each record holder of
those Depositary Shares on the record date, which will be the same date as the
record date for the Preferred Stock, will be entitled to instruct the Depositary
as to the exercise of the voting rights pertaining to the amount of the
Preferred Stock represented by that holder's Depositary Shares. The Depositary
will try, as much as practicable, to vote the amount of the Preferred Stock
represented by those Depositary Shares in accordance with such instructions, and
we will agree to take all reasonable action which may be deemed necessary by the
Depositary in order to enable the Depositary to do so. The Depositary will not
vote shares of the Preferred Stock to the extent it does not receive specific
instructions from the holder of Depositary Shares representing the Preferred
Stock. (Section 4.05)

     AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT. The form of Depositary
Receipt evidencing the Depositary Shares and any provision of the Deposit
Agreement may be amended at any time by agreement between us and the Depositary.
However, any amendment which materially and adversely alters the rights of the
holders of Depositary Shares will not be effective unless the amendment has been
approved by the holders of at least a majority of the Depositary Shares
outstanding at that time. (Section 6.01) The Deposit Agreement will terminate
only if (A) all outstanding Depositary Shares have been redeemed or (B) there
has been a final distribution in respect of the Preferred Stock in connection
with our liquidation, dissolution or winding up and the Preferred Stock has been
distributed to the holders of Depositary Receipts. (Section 6.02)

     CHARGES OF DEPOSITARY. We will pay all transfer and other taxes and
governmental charges arising solely from the existence of the depositary
arrangements. We will pay charges of the Depositary in connection with the
initial deposit of the Preferred Stock and issuance of Depositary Receipts, all
withdrawals of shares of Preferred Stock by owners of Depositary

                                       21
<PAGE>   31

Shares and any redemption of the Preferred Stock. Holders of Depositary Receipts
will pay other transfer and other taxes and governmental charges and any other
charges as are expressly provided in the Deposit Agreement to be for their
accounts. (Section 5.07)

     RESIGNATION AND REMOVAL OF DEPOSITARY. The Depositary may resign at any
time by delivering notice to us of its election to do so. We may at any time
remove the Depositary. Any resignation or removal will take effect upon the
appointment of a successor Depositary and its acceptance of such appointment.
The successor Depositary must be appointed within 60 days after delivery of the
notice of resignation or removal and must be a bank or trust company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000. (Section 5.04)

     MISCELLANEOUS. The Depositary will forward all reports and communications
from us that we deliver to the Depositary and which we are required or otherwise
determine to furnish to the holders of the Preferred Stock. (Section 4.07)

     Neither we nor the Depositary will be liable under the Deposit Agreement to
holders of Depositary Receipts other than for our negligence, willful misconduct
or bad faith. Neither we nor the Depositary will be obligated to prosecute or
defend any legal proceeding in respect of any Depositary Shares or Preferred
Stock unless satisfactory indemnity is furnished. We and the Depositary may rely
upon written advice of counsel or accountants, or upon information provided by
persons presenting Preferred Stock for deposit, holders of Depositary Receipts
or other persons believed to be competent and on documents believed to be
genuine. (Section 5.03)

                          DESCRIPTION OF COMMON STOCK

     The following summary is not complete and you should refer to the
applicable provisions of the Maryland General Corporation Law and the Articles
of Incorporation and by-laws of the Company. See "Where You Can Find More
Information."

     We are authorized to issue up to 1,500,000,000 shares of common stock, par
value $.01 per share, the "Common Stock." At December 31, 1998, we had issued
and outstanding 751,795,674 shares of Common Stock. In January 1999, we issued
50,000,000 shares of Common Stock.

     Holders of our Common Stock are entitled to receive, pro rata, dividends
declared by the Board of Directors out of funds legally available for their
payment. Our ability to pay dividends to our stockholders may be limited by
federal law. See "Regulatory Matters." In the event of our liquidation,
dissolution or winding up, holders of Common Stock are entitled to share
proportionately in the assets available for distribution to stockholders.

     Each share of Common Stock is entitled to one vote on each matter submitted
to a vote of stockholders. Holders of shares of Common Stock have noncumulative
voting rights, which means that the holders of more than 50% of the shares
voting for the election of directors can elect 100% of the directors, and the
holders of the remaining shares voting for the election of directors will not be
able to elect any directors. The Common Stock has no conversion rights and is
not redeemable. All outstanding shares of Common Stock are, and the shares sold
in the offerings will be when issued, fully paid and nonassessable. Our
stockholders have no preemptive rights to subscribe for additional shares of our
stock or other securities of ours except as may be granted by the Board of
Directors.

                                       22
<PAGE>   32

                            DESCRIPTION OF WARRANTS

     We may issue warrants, the "Warrants," to purchase Debt Securities,
Preferred Stock, Depositary Shares or Common Stock, collectively, the
"Securities." Warrants may be issued independently or together with Debt
Securities, Preferred Stock, Depositary Shares or Common Stock and may be
attached to or separate from any offered securities. Each series of Warrants
will be issued under a separate warrant agreement, each a "Warrant Agreement,"
to be entered into between us and a warrant agent, the "Warrant Agent." The
Warrant Agent will act solely as our agent in connection with the Warrants and
will not assume any obligation or relationship of agency or trust for or with
holders or beneficial owners of Warrants. Below is a description of certain
general terms and provisions of the Warrants that we may offer. Further terms of
the Warrants and the applicable Warrant Agreement will be described in the
prospectus supplement.

     The prospectus supplement will describe the following terms, where
applicable description of, the Warrants in respect of which this prospectus is
being delivered:

     - the title of the Warrants;

     - the aggregate number of the Warrants;

     - the price or prices at which the Warrants will be issued;

     - the designation, aggregate principal amount and terms of the securities
       purchasable upon exercise of the Warrants;

     - the designation and terms of the Securities with which the Warrants are
       issued and the number of the Warrants issued with each such security;

     - if applicable, the date on and after which the Warrants and the related
       securities will be separately transferable;

     - the price at which the securities purchasable upon exercise of the
       Warrants may be purchased;

     - the date on which the right to exercise the Warrants will commence and
       the date on which the right will expire;

     - the minimum or maximum amount of the Warrants which may be exercised at
       any one time;

     - information with respect to book-entry procedures, if any;

     - a discussion of certain Federal income tax considerations; and

     - any other terms of the Warrants, including terms, procedures and
       limitations relating to the exchange and exercise of the Warrants.

                    DESCRIPTION OF STOCK PURCHASE CONTRACTS
                            AND STOCK PURCHASE UNITS

     We may issue stock purchase contracts, "Stock Purchase Contracts,"
representing contracts obligating holders to purchase from us, and us to sell to
the holders, a specified number of shares of Common Stock at a future date or
dates. The price per share of Common Stock may be fixed at the time the Stock
Purchase Contracts are issued or may be determined by reference to a specific
formula described in the Stock Purchase Contracts. The Stock Purchase Contracts
may be issued separately or as a part of stock purchase units, "Stock Purchase
Units," consisting of a Stock Purchase Contract and Debt Securities or debt
obligations of third parties, including U.S. Treasury securities, securing the
holders' obligations to purchase the Common Stock under the Stock Purchase
Contracts. The Stock Purchase Contracts may require us to make periodic payments
to the holders of the Stock Purchase Units or vice-versa. These payments may be
unsecured or prefunded on some basis. The Stock Purchase Contracts may require
holders to secure their obligations thereunder in a specified manner.

     The prospectus supplement will describe the terms of any Stock Purchase
Contracts or Stock Purchase Units.

                                       23
<PAGE>   33

                              PLAN OF DISTRIBUTION

     We may sell Securities to or through underwriters or dealers, directly to
other purchasers or through agents. Each prospectus supplement will describe the
method of distribution of the Securities that are being offered.

     The distribution of the Securities may take place from time to time in one
or more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices.

     In connection with the sale of Securities, underwriters may receive
compensation from us or from purchasers of Securities for whom they may act as
agents in the form of discounts, concessions or commissions. Underwriters may
sell Securities to or through dealers, and the dealers may receive compensation
in the form of discounts, concessions or commissions from the underwriters
and/or commissions from the purchasers for whom they may act as agents.
Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters, and any discounts or commissions
received by them from us and any profit on the resale of Securities by them may
be deemed to be underwriting discounts and commissions, under the Securities
Act. Any underwriter or agent will be identified, and any compensation received
from us will be described, in the prospectus supplement.

     If so indicated in the applicable prospectus supplement and subject to
existing market conditions, we will authorize underwriters or other persons
acting as our agents to solicit offers by certain institutions to purchase
offered Debt Securities from us pursuant to contracts providing for payment and
delivery on a future date. Institutions with which contracts may be made include
but are not limited to commercial and savings banks, insurance companies,
pension funds, investment companies, educational and charitable institutions and
others, but in all cases these institutions must be approved by us. The
obligations of any purchaser under any contract will be subject to the condition
that the purchase of the offered Debt Securities will not at the time of
delivery be prohibited under the laws of the jurisdiction to which the purchaser
is subject. The underwriters and the other agents will not have any
responsibility in respect of the validity or performance of the contracts.

     Underwriters and agents who participate in the distribution of Securities
may be entitled under agreements which may be entered into by us to
indemnification by us against certain liabilities, including liabilities under
the Securities Act.

     Except as indicated in the applicable prospectus supplement, the Securities
are not expected to be listed on a securities exchange, except for the Common
Stock, which is listed on the New York Stock Exchange, and any underwriters or
dealers will not be obligated to make a market in Securities. We cannot predict
the activity or liquidity of any trading in the Securities.

                             VALIDITY OF SECURITIES

     The validity of the Securities will be passed upon for us by John W.
Scheflen, Executive Vice President, General Counsel and Secretary of the
Company, and for any underwriters, dealers or agents by Simpson Thacher &
Bartlett, New York, New York. Simpson Thacher & Bartlett will rely on the
opinion of Mr. Scheflen as to matters of Maryland law and Mr. Scheflen will rely
on the opinion of Simpson Thacher & Bartlett as to matters of New York law. Mr.
Scheflen owns beneficially in excess of 750,000 shares of Common Stock,
including options exercisable within sixty days under our stock incentive plans.
Simpson Thacher & Bartlett regularly performs legal services for us and our
subsidiaries.

                                       24
<PAGE>   34

                                    EXPERTS

     Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements which are incorporated by reference in our Annual Report on
Form 10-K for the year ended December 31, 1998, as set forth in their report,
which is incorporated by reference in this prospectus and elsewhere in the
registration statement. Our financial statements are incorporated by reference
in reliance on Ernst & Young LLP's report, given on their authority as experts
in accounting and auditing.

                                       25
<PAGE>   35

                         INDEX OF TERMS FOR PROSPECTUS

<TABLE>
<CAPTION>
                 Term                   Page
                 ----                   ----
<S>                                     <C>
Bank..................................    5
BHCA..................................    6
BIF...................................    8
Commission............................    4
Common Stock..........................   22
Company...............................    4
covenant defeasance...................   15
Debt Securities.......................   10
defeasance............................   15
Deposit Agreement.....................   20
Depositary............................   20
Depositary Receipts...................   20
Depositary Shares.....................   20
DIFA..................................    9
Direct credit substitute..............    8
Exchange Act..........................    4
FDIC..................................    6
FDICIA................................    6
Federal Reserve Board.................    6
FICO..................................    9
indebtedness for money borrowed.......   13
Indentures............................   10
Junior Securities.....................   19
</TABLE>

<TABLE>
<CAPTION>
                 Term                   Page
                 ----                   ----
<S>                                     <C>
OCC...................................    6
Other Financial Obligations...........   13
Parity Securities.....................   19
Preferred Stock.......................   18
Recourse..............................    8
Registration Statement................   10
SAIF..................................    9
Securities............................   23
Senior Debt Securities................   10
Senior Indebtedness...................   12
Senior Indenture......................   10
Senior Trustee........................   10
Stock Purchase Contracts..............   23
Stock Purchase Units..................   23
Subordinated Debt Securities..........   10
Subordinated Indenture................   10
Subordinated Trustee..................   10
Trustees..............................   10
Warrant Agent.........................   23
Warrant Agreement.....................   23
Warrants..............................   23
well capitalized......................    7
</TABLE>

                                       26
<PAGE>   36

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     NO DEALER, SALESPERSON OR OTHER PERSON IS AUTHORIZED TO GIVE ANY
INFORMATION OR TO REPRESENT ANYTHING NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT
OR THE PROSPECTUS. YOU MUST NOT RELY ON ANY UNAUTHORIZED INFORMATION OR
REPRESENTATIONS. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS ARE AN OFFER TO
SELL ONLY THE SHARES OFFERED HEREBY, BUT ONLY UNDER CIRCUMSTANCES AND IN
JURISDICTIONS WHERE IT IS LAWFUL TO DO SO. THE INFORMATION CONTAINED IN THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS IS CURRENT ONLY AS OF ITS DATE.
                            ------------------------

                               TABLE OF CONTENTS
                             PROSPECTUS SUPPLEMENT

<TABLE>
<CAPTION>
                                            PAGE
                                            ----
<S>                                         <C>
MBNA Corporation..........................   S-3
Recent Developments.......................   S-3
Use of Proceeds...........................   S-3
Selected Financial Data...................   S-4
Capitalization............................   S-6
Market Price of Common Stock..............   S-6
Dividend Limitations......................   S-7
Underwriting..............................   S-8
Incorporation of Certain Information by
  Reference...............................   S-9
Validity of the Common Stock..............   S-9
</TABLE>

                                   PROSPECTUS

<TABLE>
<CAPTION>
                                            PAGE
                                            ----
<S>                                         <C>
Table of Contents.........................    3
About This Prospectus.....................    4
Where You Can Find More Information.......    4
The Company...............................    5
Use of Proceeds...........................    5
Ratio of Earnings to Fixed Charges and
  Ratio of Earnings to Combined Fixed
  Charges and Preferred Stock Dividend
  Requirements............................    5
Regulatory Matters........................    6
Description of Debt Securities............   10
Description of Preferred Stock............   18
Description of Common Stock...............   22
Description of Warrants...................   23
Description of Stock Purchase Contracts
  and Stock Purchase Units................   23
Plan of Distribution......................   24
Validity of Securities....................   24
Experts...................................   25
Index of Terms for Prospectus.............   26
</TABLE>

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                               50,000,000 SHARES
                                MBNA CORPORATION
                                  COMMON STOCK
                            ------------------------

                                  [MBNA LOGO]
                            ------------------------
                              GOLDMAN, SACHS & CO.
                                 [RECYCLE LOGO]

              THIS DOCUMENT IS PRINTED ENTIRELY ON RECYCLED PAPER.

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