m&i loss mitigation representative wisconsin short sale

8/14/2019 m&i Loss Mitigation Representative Wisconsin Short Sale

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TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:BankofAmericaReportingMonth(s):OctNovDec2008

SubmissionDate:January30,2009

Persontobecontactedregardingthisreport:CraigRosato

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.BankofAmerica,headquarteredinCharlotte,NorthCarolina,operatesin32states,theDistrictof

Columbiaandmorethan30foreigncountries.Thecompanyprovidesadiversifiedrangeofbankingand

nonbankingfinancialservicesandproductsdomesticallyandinternationallythroughthreebusiness

segments:GlobalConsumerandSmallBusinessBanking(GCSBB),GlobalCorporateandInvestment

Banking(GCIB),andGlobalWealthandInvestmentManagement(GWIM).

AtDecember31,2008,BankofAmericahad$1.8trillioninassets,nearly$911billioninloansand$831

billionindeposits.

EconomicEnvironment2008wasayearinwhichtheU.S.economymovedintoaneconomicrecessionthatdeepenedseverely

inthefourthquarter,triggeredinpartbytheintensifyingfinancialcrisis.Housingactivityandprices

declinedsharplythroughouttheyear.Consumerspendingininflationadjustedtermssoftenedinthe

firsthalfof2008,andthendeclinedinthesecondhalf,weigheddownbythespikeinenergypricesthat

reducedrealpurchasingpower,weakertrendsinemploymentandpersonalincomeandthelossof

householdwealth

resulting

from

sharp

declines

in

home

prices

and

stock

market

valuations.

Sales

of

automobiles,householddurablesandconsumerdiscretionaryitemswerehitthehardest.

Thestressconsumersexperiencedfromdepreciatinghomeprices,risingunemploymentandtighter

creditconditionsresultedinahigherlevelofbankruptcyfilingsduringtheyearaswellashigherlevelsof

delinquenciesandlossesinourconsumerandsmallbusinessportfolios.Housingvaluedeclines,a

slowdowninconsumerspendingandtheturmoilintheglobalfinancialmarketsalsoimpactedour

commercialportfolioswhereweexperiencedhigherlevelsoflosses,particularlyinthehomebuilder

sectorofourcommercialrealestateportfolio.

CreditMarketsFirstmortgageratestoconsumersdroppedsubstantiallyinDecemberleadingtoincreasedapplication

volume. OriginationactivityduringthemonthofDecemberwas33%higherthanNovemberactivity.

Theincreaseinvolumeisprimarilyduetorefinancingintoconventionalproducts. ThelevelofFHAand

VAproductactivityhasremainedrelativelyflat. Nochangesincreditstandardsoccurredduring

Decemberthatwouldhaveimpactedoriginations. Themajorityoftherecentapplicationvolumehas


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2

beenrefinanceactivity. Justover20%ofthevolumeisrelatedtonewpurchases. Homeequitydemand

remainssluggish.

Auto

activity

was

up

in

December

and

into

January

2009.

Inconsistent

market

participationfromthecaptivefinancecompaniesisdrivingincreasedvolume. MarineandRVvolume

andbookingsslowedsignificantlyin2008andinto2009.

Overallnewloandemandforcommercialrealestateisdownduetothelackofnewconstructionactivity

andtheoverallconditionoftherealestatemarket.TheCMBSmarketremainsclosedandthelackof

permanentfinancingcontinuestoputpressureonbankdeals. Largecorporatedemandisstable;

howeverthereislimiteddemandforacquisitionfinancingandcapitalexpenditureactivity. Middle

marketdemandremainsstable.

Bankof

Americas

Response

Inresponsetothesechangingconditions,BankofAmericadidthefollowingtohelpstabilizetheU.S.

economy:

BankofAmericaextendedmorethan$115billioninnewcreditduringthefourthquarterof2008,of

whichabout$49billionwasincommercialnonrealestate;$45billionwasinmortgages;nearly$8

billionwasindomesticcardandunsecuredconsumerloans;nearly$7billionwasincommercialreal

estate;morethan$5billionwasinhomeequityproducts;andapproximately$2billionwasinconsumer

DealerFinancialServices.

Bankof

America

lent

$45

billion

through

its

mortgage

unit

($11.3

billion

of

that

to

low

and

moderate

incomeborrowers),helpingmorethan200,000Americanspurchaseahomeorsavemoneyonthe

hometheyalreadyowninthefourthquarteralone.

BankofAmericacommittedtoassistasmanyas630,000customerstohelpthemstayintheirhomes,

representingmorethan$100billioninmortgagefinancing.In2008,thecompanymodified

approximately230,000homeloans representingmorethan$44billioninmortgagefinancing.Bankof

Americaalsomodifiednearly700,000creditcardloansforborrowersexperiencingfinancialhardship

lastyear.

In2008,BankofAmericaextendedalmost$4.8billioninnewcredittonearly250,000smallbusiness

customers(defined

as

businesses

with

less

than

$2.5

million

in

revenues

and

less

than

$250,000

in

credit

exposure).Duringthefourthquarteralone,nearly$1billioninnewcreditwasextendedtomorethan

47,000newsmallbusinesscustomers.

BankofAmericaextendedabout$49billionincommercialnonrealestatelendingcreditandnearly$7

billioninrealestatelendingduringthefourthquartertomiddlemarketandlargecorporateclientsas


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3

wellasnotforprofitorganizationsandgovernments.In2008,thecompanyalsoinvested$1billionin

affordablehousing

development

financing

by

using

Low

Income

Housing

Tax

Credits.

Thesecondarymarketcreatedthroughmortgagebackedsecuritiesprovidesliquidityinthehousing

market,enablinglenderstoprovidecredittohomebuyers.Inthefourthquarter,BankofAmericahad

netpurchasesof$20billioninmortgagebackedsecurities.


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Nameofinstitution: BankofNewYorkMellonCorporation Submissiondate:January30,2009

PARTI. QUANTITATIVEOVERVIEW

2008

SCHEDULEA:CONSUMERLENDING(Millions$) OCT NOV DEC Key

1.FirstMortgage

a.AverageLoanBalance(DailyAverageTotalOutstanding) $4,637 $ 4, 67 2 $ 4, 69 4 S ec uredby1stliensonclosedendloansfor14familyresidenti

mortgages.

b.TotalOriginations $89 $54 $69

(1)Refinancings $37 $17 $25

(2)NewHomePurchases $52 $37 $44

TREASURYMONTHLYINTERMEDIATIONSN

1

2.HomeEquity

a.AverageTotalLoanBalance $331 $335 $341 Securedbyrevolving,openendloansfor14familyresidentialp

credit.

b.Originations (NewLines+LineIncreases) $12 $12 $10

c.TotalUsedandUnusedCommitments $769 $772 $781 Periodendbalancesplusunusedhomeequitylinesofcredit.

3.USCard Managed

a.AverageTotalLoanBalance Managed $0 $0 $0

b.NewAccountOriginations(InitialLineAmt) $0 $0 $0

c.TotalUsedandUnusedCommitments $0 $0 $0

4.OtherConsumer

a.AverageTotalLoanBalance $789 $765 $757 Otherconsumerloans,excludingotherrevolvingcreditplans. T

paymentloansandloansforhouseholdandotherpersonalexpe

b.Originations $8 $5 $4

1


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SCHEDULEB:COMMERCIALLENDING(Millions$) OCT NOV DEC Key

1.C&I

a.AverageTotalLoanandLeaseBalance $1 0, 44 5 $ 10, 70 9 $1 0, 80 9 D ome st icandforeignloansandleasestomanufacturersandoth

excludingloansmadetofinancecommercialrealestate.

b.RenewalofExistingAccounts $163 $135 $504

c.NewCommitments $490 $449 $116

2.Commercial RealEstate

a.AverageTotalLoanandLeaseBalance $3,086 $3,100 $3,074 Loanstofinancecommercialrealestate,constructionandlandd

loansbothsecuredandunsecured.


2


SCHEDULEC:OTHERINTERMEDIATIONACTIVITIES(Millions$)

1.MBS/ABSNetPurchasedVolume

a.MortgageBackedSecurities $202 $1,451 $7 Reportedamountsareamountspaidforthesecurities. Includes

millioninNovofAgencyDebentures.

b.AssetBackedSecurities $0 $0 $0

2.SecuredLending(Repo,PB,MarginLending)

a.AverageTotalMatchedBook(Repo/ReverseRepo)1 N/A N/A N/A Activitylessthan$50billion.

b.AverageTotalDebitBalances2 $5,344 $4,721 $4,573

3.Underwriting

a.TotalEquityUnderwriting $0 $0 $0 Noequitydealsinthe4thquarter.

b.TotalDebtUnderwriting $129 $305 $336 Representsourportionofthetransactions.

Notes:

2.Applicableonlyforinstitutionsofferingprimebrokerageorothermarginlendingservicestoclients.

1.Notapplicableifmatchedbookactivitydoesnotexceed$50billion.

2


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TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: BankofNewYorkMellonCorporationReportingmonth(s):OctNovDec2008

Submissiondate:January30,2009Persontobecontactedregardingthisreport:JeffreyDLandau

1

PARTII. QUALITATIVEOVERVIEWTheBankofNewYorkMellon,agloballeaderinassetmanagementandsecuritiesservicing,alsohasa

significantpresenceintheareasofwealthmanagement,issuerservices,clearingservicesandtreasury

services. Thecompany'sglobalclientbaseincludesfinancialinstitutions,corporations,government

agencies,pensionfunds,endowmentsandfoundations. Thecompanydoesnothaveaconsumer

bankingfranchise.

Withregardtoourlendingactivity,itisparamounttopointoutthatthebusinessmodelofTheBankof

NewYorkMellonisverydifferentfromtraditionalretail,commercialorinvestmentbanks. Incontrastto

mostoftheothercompaniesthathavereceivedaTARPinvestment,ourbusinessmodeldoesnotfocus

onthe

broad

retail

market

or

products

such

as

mortgages,

credit

cards

or

auto

loans,

or

on

typical

lendingtocorporatebusinesses.

Ourbusinessisdedicatedtohelpingotherfinancialinstitutionsaroundtheworld. Wehelpmonitorand

administertheircomplexbackofficeprocesses. TheBankalsoprovidescriticalinfrastructureforthe

globalfinancialmarketsbyfacilitatingthemovementofmoneyandsecuritiesthroughthemarkets.

ThemajorityofTheBankofNewYorkMellonslendingactivityrelatestoextendingcredit(i.e.,

overdrafts,loanstobroker/dealers,etc.)toitsinstitutionalclientbase. FollowingtheLehman

bankruptcy,weexperiencedasignificantincreasein(i)demandforloansfromourbroker/dealerclients

and(ii)overdraftsrelatingtotheclearingandsecuritiesprocessingservicesweprovidetoclients. Our

willingness

and

ability

to

extend

credit

in

this

manner

provided

liquidity

to

the

market

and

our

core

financialinstitutionclientbaseatthetimeitwasneededmost. Duringthelatterpartofthefourth

quarter2008,andintoJanuary2009,clientdemandfortheseextensionsofcreditreturnedtomore

normallevels. Loanstobroker/dealersandoverdraftsareincludedintheaggregateamountofloans

thatwepubliclyreport,butarenotclassifiedasC&Iloans.

Inkeepingwithitsroleasaninstitutionalprovider,TheBankofNewYorkMellonhasusedtheTARP

investmenttohelpaddresstheneedtoimproveliquidityintheU.S.financialsystem. Thishasbeen

donethroughthepurchaseofsecuritiesissuedbyU.S.governmentsponsoredagencies. Thecompany

hasalsoprovidedliquiditytootherfinancialinstitutionsinordertoincreasetheamountoffunds

availableinthecreditmarkets.

Specifically,we

have

purchased

mortgage

backed

securities

and

debentures

issued

by

U.S.

government

sponsoredagenciestosupporteffortstoincreasetheamountofmoneyavailabletolendtoqualified

borrowersintheresidentialhousingmarket. Thecompanyhasalsopurchaseddebtsecuritiesofother

financialinstitutions,whichhelpsincreasetheamountoffundsavailabletolendtoconsumersand

businesses. Inaddition,wehaveusedthefundsforinterbankplacements,federalfundssoldandother

interbanklending. Alloftheseeffortsaddresstheneedtoimproveliquidityinthefinancialsystemand

areconsistentwithourbusinessmodelwhichisfocusedoninstitutionalclients.


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Nameofinstitution: BB&TCorporation Submissiondate:January30,2009


2008


1.FirstMortgage

a.AverageLoanBalance(DailyAverageTotalOutstanding) $18,477 $18,362 $18,219 Consistsof14familyresidentialloansoriginatedprimarilythroughBB&T'sbra

b.Total

Originations $1,426 $1,008 $1,248

(1)Refinancings $672 $461 $666 Includesloansoriginatedforsaleandtobeincludedinthemortgageportfolio.


TREASURYMONTHLYINTERMEDIATIONSNA

1

2.HomeEquity

a.AverageTotalLoanBalance $5,645 $5,718 $5,809 Item2includesonlyhomeequitylines.AllareoriginatedthroughBB&T'sbran


c.Total

Used

and

Unused

Commitments $15,765 $15,777 $15,788

3.USCard Managed

a.AverageTotalLoanBalance Managed $1,930 $1,934 $1,966 Item3balancesincludebankcardsanddemanddepositprotectionlines.Bank

primarilyoriginatedthroughthebankingnetworkandarepositionedasarelat


c.TotalUsedandUnusedCommitments $9,498 $9,565 $9,629

4.OtherConsumer

a.AverageTotalLoanBalance 18,877 18,766 18,653 Item4includesnonrevolvinghomeequityloans,salesfinanceandothercons


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1.C&I

a.AverageTotalLoanandLeaseBalance $32,470 $32,947 $33,531 Item1.a.includesleveragedleases.


c.NewCommitments $1,473 $1,372 $1,554

2.CommercialRealEstate

a.AverageTotalLoanandLeaseBalance $19,366 $19,383 $19,614

b.RenewalofExistingAccounts $1,142 $911 $1,218

2




a.MortgageBackedSecurities $5,313 $ 3,72 3 $ 10 ,9 28 I te m1.a.representsgrosspurchases,netofgrosssalesonatradedatebasis.P

paydownsareexcluded.AllthesesecuritiespurchasesareGSEmortgageback

b.AssetBackedSecurities $0 $0 $0


a.AverageTotalMatchedBook(Repo/ReverseRepo)1 N/A N/A N/A

b.AverageTotalDebitBalances2 $127 $117 $110

3.Underwriting

a.TotalEquityUnderwriting $0 $0 $0

b.TotalDebtUnderwriting $850 $430 $1,304

Notes:



2


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TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: BB&TCorporationReportingmonth(s): Oct,Nov,Dec2008

Submissiondate: January30,2009Persontobecontactedregardingthisreport:DarylN.Bible,ChiefFinancialOfficer

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.

CompanyDescription

BB&TCorporation(BB&T)isaregionalfinancialholdingcompanyheadquarteredinWinstonSalem,

NorthCarolina.BB&Tconductsitsbusinessoperationsprimarilythroughitscommercialbanksubsidiary,

BranchBankingandTrustCompany,whichhasbankingofficesinNorthCarolina,SouthCarolina,

Virginia,Maryland,

Georgia,

West

Virginia,

Tennessee,

Kentucky,

Alabama,

Florida,

Indiana

and

Washington,D.C.Inaddition,BB&Tsoperationsconsistofseveralnonbanksubsidiaries,whichoffer

financialservicesproducts.SubstantiallyallofBB&Tsloansaremadetobusinessesandindividualsin

thesemarketareas.

OverallLoanGrowth

Inthefourthquarterof2008,BB&T'saverageloansandleasesincreased$1.3billion,or5.3%

onanannualizedlinkbasis,andBB&Tsendofperiodloansincreased$2.0billion,or8.2%onan

annualizedlinkbasis,comparedtothethirdquarterof2008.Thisgrowthrateincludesrunoffin

homeequitylines,whichresultsasmanyclientsarerollinghomeequitylinesintomortgage

refinancing,and

lower

mortgage

balances

as

BB&T

is

selling

alarge

percentage

of

loans

originatedtoFannieMaeandFreddieMac.Averagecommercialloansandleasesincreased

10.7%onanannualizedlinkquarterbasisduringthefourthquarter,salesfinanceincreased

3.8%,revolvingcreditincreased11.5%andloansoriginatedbyourspecializedlending

subsidiariesincreased7.0%,allonthesamebasis.BB&Toriginatedapproximately54,000

commercialloansduringthefourthquarterand161,000consumerloans.Totalloan

originationsforthefourthquarterof2008wereapproximately$15billion.

CommercialLoansandLeases

ThecommercialloanandleaseportfoliorepresentsthelargestcategoryofBB&Tsloans.Itis

traditionallytargeted

to

serve

small

to

middle

market

businesses.

BB&T

is

focusing

on

diversifying

the

commercialportfoliobygrowingcommercialandindustrialloansatafasterratethancommercialreal

estateloans.Wecontinuetocapitalizeoninmarketmergers,challengedcompetitorsandcreditmarket

disruptionandhavegrownendofperiodC&Iloansbyapproximately20%onanannualizedlinkquarter

basis.Wearegainingmarketsharebypickingupgoodcreditsatreasonablespreads,whileguarding

againstadverseselection.WhilewehaveseenrecentgrowthinlendingtoourSmallCommercialand

lowerMiddleMarketclients,muchofthegrowthhasalsocomefromourlargerclientsegments.


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Commercialrealestate

Overallnewloandemandforcommercialrealestateisslower;however,duetothecollapseofthe

CMBSmarket,BB&TsotherCREportfoliohasexperiencedgrowthin2008,particularlyinthe

multifamily,warehouse/lightindustrialandhotel/motelsegments.Endofperiodgrowthforthe

fourthquarterwasapproximately25%.Thisgrowthisinspiteoftighterlendingstandardsimposedmid

year2008andwasprimarilyaresultofbankandnonbankfinancialinstitutionscurtailingincome

propertylending.BB&TsotherCREportfolioisverygranular,withanaverageloansizeof$515,000.

Consumer

Newproductioncontinuestodeclineinmostconsumerportfoliosasthesemarketscontinuetoreflect

recessionrelatedweakness.

OurSalesFinanceportfolioincludestheoriginationofloansforthepurchaseofnewandused

automobiles,boatsandrecreationalvehiclesthroughapproveddealerswithinthe11stateBB&T

footprint.Newloanvolumeishighlyseasonal.ThetotalSalesFinanceportfoliogrewslightlyinthe

fourthquarterfueledbygrowthinrecreationallendingandfloorplanportfolios.Autoloansweredown

inaccordancewithseasonaltrendscoupledwithadownturninnewcarsales.However,thedecrease

wasnotasgreatasexpectedbecausewearegainingmarketshareasotherlenderswithdrawfromour

footprint.

OurBankcardproductlineispositionedasarelationshipproductofferedtoprimecreditBB&Tclients

andbusinessloanclients.Wecontinuetoseegrowthinthisportfolio,andaremaintainingaconsistent

conservativeposturewithrespecttoriskataccountorigination.Lineutilizationhasremainedrelatively

consistentforbothretailandcommercialclients.

Mortgage

Mortgageoriginationstotaled$3.7billioninthefourthquarter,downslightlycomparedtothethird

quarterof2008.However,applicationvolumewasup42%fromthethirdquarterasmortgagerates

declinedconsiderably.ManyoftheseapplicationswerereceivedinthemonthofDecember. While

mortgagebalancesweredownonaverage2.9%onanannualizedlinkquarterbasiscomparedtothe

thirdquarter,

this

decrease

reflects

loan

sales

to

Freddie

Mac

and

Fannie

Mae

as

approximately

86%

of

originationsweresoldinthesecondarymarkets.Thevastmajorityofcurrentoriginationvolumeis

conformingorFHA/VA.


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3

CapitalPurchase

Plan

Deployment

TheU.S.Treasuryinvested$3.1billioninBB&TonNovember14,2008.BB&Tpursuedqualityloansand

investmentsthroughout2008,asevidencedbyaverageloangrowthof8.6%throughthefirstnine

monthsof2008.FollowingreceiptoftheCPPfundsandinthespiritoftheprogram,BB&Tdevelopedan

initialdeploymentstrategy,includinganumberofinitiatives,toaggressivelymakeloansacrossall

lendingstrata.Wehavemadeadditionalloansinareasthathavebeennegativelyaffectedbyliquidity

andfundingchallenges,particularlythroughinitiativesincorporatelending,equipmentleasing,

insurancepremiumfinanceandconsumerlending.Inadditiontoournormallendingactivities,these

speciallendinginitiativeshaveresultedinanadditional$1.6billioninloansandcommitmentstolend

thatweremadeinthesixweeksfollowingreceiptoftheCPPfundsthroughtheendof2008.

BB&Talsoinvestedover$10billioninGSEmortgagebackedsecuritiesfollowingreceiptoftheCPP

fundsinthefourthquartertoprovideliquiditytomortgagemarkets.Throughtheselendingand

investmentinitiatives,BB&Tincreasedthebalancesheetbythemaximumamountpossibleinthefourth

quarterconsistentwithmeetingourminimumcapitalguidelinesinanefforttominimizethedilutive

impactoftheCPPinvestment.BB&T'scurrentstrategyistoredeploythecashflowfromoursecurities

portfoliointolendingoverthecourseoftheyear,therebychangingthemixofourbalancesheet,but

holdingtotalassetlevelsfairlystablethroughouttheyeartomaintainourcapitallevels.


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TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:CapitalOneFinancialCorporationReportingmonth(s): OctNovDec2008

Submissiondate: January30,2009Persontobecontactedregardingthisreport:KevinMurray

1


CapitalOneisamainstreetbankthatservesconsumersandsmalltomediumsizedbusinesseslocally

inNewYork,LouisianaandTexasandthatservescreditcardandautoloancustomersnationally,in

CanadaandintheUK. CapitalOneanditssubsidiariescollectivelyhad$109billionindepositsand$147

billioninmanagedloansoutstandingasofDecember31,2008. HeadquarteredinMcLean,VA,Capital

Onehas738locations,primarilyinNewYork,NewJersey,TexasandLouisiana. CapitalOneoffersa

broadspectrumoffinancialproductsandservicestoconsumers,smallbusinessandcommercialclients.

ConsumerLendingInthefourthquarter,weextendedbillionsofdollarsinnewcredittobothnewandexistingcustomers

acrossourlendingbusinesses. Forexample,ourconsumercreditcardcustomershaveaccesstomore

than$170billionincreditlinesontheircardstousetomaketransactionsandtofinancethose

purchasesastheychoose. Wecontinuetooriginatenewcreditcardaccountsthroughourdirectmail

and

internet

channels

and

opened

1

million

new

credit

card

accounts

in

the

fourth

quarter.

We

extendedthosenewcustomersmorethan$3billioninnewcreditlineinthefourthquarter.

Whileweoriginatedbillionsofdollarsofnewloansinthefourthquarter,endingloanbalancesforthe

totalcompanydidnotgrowinthequarter,anddeclinedmodestlyfromtheprioryear. Severalfactors

hadanegativeimpactonendingloanbalancesinthefourthquarterof2008. Thesefactorsinclude:

risingchargeoffs;normalamortizationandattrition;decliningpurchasevolumes;andtightened

underwritinginthemidstoftheeconomicdownturn. Together,thesefactorsoffsetloanoriginationsin

thefourthquarter. OfparticularnoteisthattotalpurchasevolumeonourUSConsumerCreditCards

dropped11%intheFourthQuarterof2008andpurchasesperactiveaccountdropped6%,whichwas

roughlyinlinewiththedeclineinnationalretailsalesfigures. Ingeneral,themixofpurchasesonour

cardshasmirroredwhatwe'reseeinginthebroadereconomy,withconsumersreiningindiscretionary

purchases.

Asiswelldocumented,economicdeteriorationacceleratedduringthefourthquarterandeconomic

worseningiswidelyprojectedtocontinue.Wemustmaintainprudentriskmanagementstandardsin

thefaceofaworseningeconomyinordertoprotecttheU.S.taxpayersinvestmentinusandensurean


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2

appropriatereturn. Also,wemustadapttoanenvironmentinwhichconsumerswithstrongcreditare

borrowingless

while

consumers

with

weak

credit

are

becoming

riskier.

Under

these

conditions,

we

expectthatloanbalanceswilldeclinegoingforwardeventhoughweremainanactivelenderacrossour

businesses. Forexample,autosalesdeclinedsignificantlyin2008comparedtolastyeardueto

weakenedconsumerconfidence,tightcreditandrisingunemployment.Newcarsalesdropped

approximately18%from16.2millionin2007to13.3millionin2008. InQ42008,carsalesdroppedby

over30%comparedtothepreviousyear. Despitetheseheadwinds,CapitalOneoriginatedmorethan

$1.4billioninautoloansintheFourthQuarterof2008.

Commercialand

Small

Business

Lending

and

Commercial

Real

Estate

Lending

GrowthincommercialandIndustriallendinginthefourthquarterwasmoderatedbyweakening

demandwhichhascontinuedintothefirstquarterof2009. C&Iloandemandwasmoderatelyweaker

forlargeandmiddlemarketfirms. Forsmallerfirms,loandemandwassubstantiallyweaker. The

decreaseindemandwasattributedtodecreasingneedsforthefinancingofplant,equipment,inventory

andaccountsreceivable.

Notwithstandingdeterioratingeconomicconditions,wecontinuetomakenewloansacrossavarietyof

industrysegmentsasevidencedbyourmorethan$2.5billioninnewloancommitmentsandrenewals

ofexistingaccountsinthefourthquarter.

Despitedeterioratingeconomicconditions,weincreasedourCREportfoliomodestly. TheRetailasset

classhassoftenedoverallasmanyretailershavecutbackexpansionplansorgoneintobankruptcy.

Officespaceisnotyetshowingsignificantdeteriorationinourmarkets,althoughdramaticjoblosses

couldimpactthissegmentin2009.Weseesoftnessinconstructionanddevelopmentactivitydueto

limiteddemandandexcesssupplyinsomemarkets.Wearewatchingrentsandvacanciesinretailand

officespacecloselyandfactoringtrendsintonewlendingdecisions. Inallsectors,wearemaintaining

strongcovenantsandcoverageratios. Thishastranslatedintosignificantdeclinesinnewconstruction

projectsinallofourmarketsandcautiousgrowthinothersegments.

Wecontinuetomakenewloansacrossavarietyofindustrysegments,aswellaslendinginnew

markets,whichcontributedtothemorethan$900milliondollarsinnewcommitmentsandrenewalsof

existingaccountsinthefourthquarter.

Finally,wewouldnotethatconsistentwithourstrongcommitmenttosupportallsectorsofourlocal

communities,CapitalOneoriginatedmorethan$440millioninloansandinvestmentsinQ42008to

supportactivitiessuchascommunitydevelopmentandaffordablehousing.


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3

InvestmentActivityinSupportofConsumerLendingTotheextentthatfallingloandemandlimitstheextensionofnewcreditdirectlytoourcustomers,we

putourfundstoworkbypurchasinghighqualitysecuritiesbackedbyconsumerloans.Mostoften,

theseloanswereoriginatedtohelpconsumerstobuyhomes,autosandarangeofdiscretionaryitems.

Inthefourthquarter,wepurchased$6billionofhighqualityinvestmentsecuritiesbackedbymortgage

andconsumerloans. Inthecurrenteconomicandmarketenvironment,investinginhighquality,short

durationsecuritiesprovidesappropriateriskadjustedreturnsforourshareholders,andsupportsthe

recoveryandstabilizationofsecondarymarketsthatarecriticaltoconsumerlendingandtheeconomy.

CapitalOnebelievesthatthisdisciplinedstanceisinthebestinterestsofbothourcustomersand

investors,includingtheU.S.taxpayer. Althoughgrowthinloanbalanceshasslowedinresponsetorising

chargeoffs,runoffsinbusinessesweveexitedandreducedconsumerspending,weareactively

originatingbillionsofdollarsofgoodloansongoodtermswithourconsumer,commercialandsmall

businesscustomers.


19/90

Nameofinstitution: CITGroupInc. Submissiondate:01/30/2009


2008


1.FirstMortgage

a.AverageLoanBalance(DailyAverageTotalOutstanding)

b.Total

Originations

(1)Refinancings

(2)NewHomePurchases


1

2.HomeEquity

a.AverageTotalLoanBalance

b.Originations (NewLines+LineIncreases)

c.TotalUsedandUnusedCommitments

3.USCard Managed

a.AverageTotalLoanBalance Managed

b.NewAccountOriginations(InitialLineAmt)


4.OtherConsumer


12,776$ 12,692$ 12,604$

ConsumerLendingassetsconsistprimarilyofourStudentLendingbusiness,wh

approximately95%

government

guaranteed.

b.Originations

1$ 1$ 1$

1


20/90


1.C&I

a.AverageTotalLoanandLeaseBalance

57,085$ 56,224$ 55,075$

IncludedintheC&Iassetbalancesisapproximately$13Billionofoperatingle

b.RenewalofExistingAccounts

4,083$ 3,344$ 2,960$

TheRenewalofExistingAccountsispredominatelyfromourTradeFinancebus

c.NewCommitments

1,233$

887$

1,221$

2.CommercialRealEstate

a.AverageTotalLoanandLeaseBalance

882$ 880$ 866$

Someofourotherbusinesses,suchasourSmallBusinessAdministrationlendi

financing,mayalsohavesomeoftheirloanssecuredbyrealestate. Thosebus

includedinthereportedC&Inumbers.

b.RenewalofExistingAccounts

2

c.NewCommitments



a.MortgageBackedSecurities

b.AssetBackedSecurities


a.AverageTotalMatchedBook(Repo/ReverseRepo)1

b.AverageTotalDebitBalances2

3.Underwriting

a.TotalEquityUnderwriting

b.TotalDebtUnderwriting

Notes:



2


21/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: CITGroupInc.Reportingmonth(s): OctNovDec2008

Submissiondate: 01/30/2009Persontobecontactedregardingthisreport:KenReynolds

1


Foundedin1908,CITGroupInc.providesfinancingandleasingproductsandservicestoclientsinover

30industriesand50countries.Themajorityofourbusinessfocusesoncommercialclientswitha

particularfocusonmiddlemarketcompanies.Ourlargestindustriesincludetransportation,particularly

aerospaceandrail,andabroadrangeofmanufacturingandretailing.Wealsoservethewholesaling,

healthcare,communications,mediaandentertainmentandvariousservicerelatedindustries.

TheTARPmoneywasreceivedbyCITonDecember31,2008. Thereportinginformationisbasedon

CIT'sinternalreportingontherelatedlendingactivity.Overall,commercialfinancingdemandhas

declinedduetocurrenteconomicconditions.Originationvolumeinourcommercialbusinesses,

excludingfactoring,was$3.3billionforthefourthquarter2008,downfrom$3.9billionintheprior

quarter,dueprimarilytoeconomicconditionsandbalancingofliquiditywithcustomerneeds. Fourth

quarterbusinessactivitybysegmentisdiscussedbelow:

CorporateFinanceFourthquartervolumewas$834million. Fourthquarteroriginationwasdown44%

fromthepriorquarterandwasacrosseachofourindustrygroups,mostnotablyintheSyndicatedLoan,

CommercialandIndustrial,EnergyandInfrastructureandHealthcareunits. Thistrendreflectedthe

continuation

of

the

Companys

liquidity

management

and

tighter

underwriting

in

light

of

the

soft

market

conditions

TransportationFinanceFourthquartervolumewas$722million. Fourthquarteroriginationincreased

21%fromthepriorquarter,withtheincreaselargelyinthecommercialaerospaceunit,asweaccepted

deliveryofadditionalaircraftandleasedthemtocustomers.

TradeFinanceFourthquartervolumewas$10.3billion. Renewalvolumedeclined6%fromprior

quarterconsistentwithseasonaltrendsasvolumegenerallypeaksinadvanceoftheholidayseason.

Volumedeclined14%fromtheprioryear,reflectingtheweakretailenvironment.

VendorFinanceFourthquartervolumewas$1.8billion. Fourthquarteroriginationwasessentiallyflat

withprior

quarter

as

amodest

increase

in

U.S.

volume

offset

reductions

in

international

units.

Volume

wasdown33%fromprioryear,reflectingcontinuedfocusonstrategicvendorrelationshipsandtighter

underwritingstandards.

ConsumerWeceasedoriginationofstudentloansinthesecondquarterof2008andsoldourhome

lendingbusinessinthethirdquarterof2008.


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24/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:CitigroupInc.Reportingmonth(s): OctNovDec2008

Submissiondate: January30,2009Persontobecontactedregardingthisreport:CarolHaylesorPeterBieszard

1

PARTII. QUALITATIVEOVERVIEWCompanydescription: CitigroupInc.(Citi)doesbusinessintheUnitedStatesthroughCitibank,CitiInstitutionalClientsGroup,TheCitiPrivateBank,SmithBarney,Primerica,DinersClub,CitiFinancial,

CitiMortgageandCitiCards. AverageloansinNorthAmericainthefourthquarterof2008were$532.6

billion. Averagedepositsandothercustomerliabilitybalanceswere$279.9billion.

ConsumerLending: NewU.S.consumerlendinginthefourthquartertotaledapproximately$48.7billiondespiteadeclineinconsumerspending,tighterunderwritingstandardsacrosstheU.S.banking

industryinlightofthedeterioratingcreditenvironmentandcapitalconsiderations.

Firstmortgage

balances

declined

from

October

through

December,

reflecting

increased

sales

of

mortgagesandhigherrepayments,duetorefinancingasmortgageinterestratesdeclined. Origination

volumewassignificantlylowerthanintheprioryear,reflectingadeclineinmortgageapplications,

tightenedcreditstandards,declinesinpurchasesfromthirdpartyoriginators,andafocusonorigination

forsaletogovernmentsponsoredenterprises. Quantitativedatadonotincludemodificationsto

existingmortgageloansandothermitigationeffortswhichusuallyinvolvearestructuringofterms

ratherthananewextensionofcredit.

Averageconsumercreditcardtotalloanbalancesincreasedduringthequarter,reflectingseasonal

spendingandslowerpaymentrates;however,yearoveryearsalesdeclinedconsistentwiththecurrent

economicenvironment. Citismanagednetcreditlossratewas8.04percentinthequarteragainst5.1

percent

in

the

prior

year,

a

further

sign

of

the

financial

strains

on

U.S.

consumers.

More

than

360,000

cardmembersenteredCitisforbearanceprogramsinthefourthquarterastheCompanyintroduced

newprogramswithbroadenedeligibilitycriteriathatbenefitaccountsinearlierstagesofdelinquency.

Averagetotalbalancesonotherconsumerloans,whichincludeauto,studentandpersonalloans,were

largelystableoverthequarter,whileoriginationsdeclined,reflecting,amongotherthings,asignificant

declineinpersonalloanapplications. Minimalautolendingactivityreflectedbusinessconsolidation

andtightercreditstandards,againconsistentwiththeeconomicenvironment. Fourthquarterstudent

loansdeclinedovertheprioryear,reflectingCitistemporarywithdrawalfromtheFederalLoan

Consolidationmarket. ThiswaspartiallyoffsetbyincreasesinnewFederalFamilyLoanEducation

Program(FFLEP)volume. HigherFFELPvolumereflectedincreasedloanlimitsandhigherpenetrationat

educationalinstitutions.

CommercialLending: NewU.S.commerciallending(includingCommercialRealEstate)ofapproximately$11.4billionduringthequarterreflectsnewtransactionsinsupportofcorporateacquisitions,aswellas

generalcorporatefinancing. WhileC&Ibalanceswererelativelyflatinthequarter,themarket

evidencedadeclineinbusinessinvestment,M&Aactivityandinvestmentpropertypurchasesin

responsetotheeconomicoutlookfor2009. Weexpectincreasedrenewalactivityin2009,asexisting

facilitiesarerefinancedand/orrestructured.


25/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:CitigroupInc.Reportingmonth(s): OctNovDec2008

Submissiondate: January30,2009Persontobecontactedregardingthisreport:CarolHaylesorPeterBieszard

2

Demandfor

small

business

credit

remained

relatively

strong

on

previously

approved

credit

facilities,

althoughdemandfornewfacilitieswaslow.

Overall,newloandemandandoriginationforcommercialrealestateweredown,duetotheeconomic

environmentanduncertaintiesinthemarket,whichhaveresultedinasignificantslowdownin

transactionactivity. OurinvestorportfolioinCitisGlobalWealthManagementbusinesshashistorically

focusedonshort tomedium termlendingonexistingcommercialrealestateassets,andmanyclients

soughtshorttermbridgefinancingofcompletedprojectsintheabsenceofapermanentorcommercial

mortgagebackedsecuritiesmarket. OurInstitutionalClientGroupisrollingoverandextendingloansin

itsexistingcustomerbasewhereitiscomfortablewiththecounterpartyandtheunderlyingassets.

OtherIntermediationActivities: Citieffectednetpurchasesofapproximately$28.0billionofmortgageandassetbackedsecurities(MBS/ABS)duringthequarter,inamarketthatwascharacterizedbysharpselloffsandweakinvestordemand.

GrossMBSpurchasesandsalesactivityjumpedinDecember,dueprimarilytoincreasedagencypass

throughpoolsettlementswithbothcustomersanddealers,howeversalesactivitywasslightlyhigher

thanpurchases,resultinginalowernetbalanceinthemonth. Inaddition,Citimade$6billionofMBS

purchasestomaintaintargetedlevelsofsecuredfunding. ABSactivitywasprimarilycustomertrading

andpurchasesofcollateralizedfinancingnotesissuedbytheBigThreeautofinancingcompanies

MatchedBooksecuredlendingdeclinedfromOctobertoDecember,duetoreducedcustomer

collateralizedfinancingactivity.

SpreadsoncorporatebondsrosesubstantiallyinOctoberandNovember,andnewissuancedeclined

markedly. CreditmarketsrecoveredsomewhatinDecember,increasingdebtmarketactivityaftera

numberoftheFederalReserveinitiativesstartedtotakeeffectandimprovethedaytodayfunctioning

ofthecapitalmarkets.

###


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27/90


28/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:COMERICAINCORPORATEDReportingmonth(s): OctNovDec2008

Submissiondate:1/30/09Persontobecontactedregardingthisreport:DarlenePersons

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.ComericaIncorporatedisafinancialservicescompanyheadquarteredinDallas,Texas;strategically

alignedintothreemajorbusinesssegments:theBusinessBank,theRetailBankandWealth&

InstitutionalManagement,andoperatesinfourprimarymarkets:Texas,theMidwest(primarily

Michigan),Western(primarilyCaliforniaandArizona)andFlorida.

TheprincipalfocusofComericaIncorporatedistomeettheneedsofsmallandmediumsized

businesses,multinational

corporations

and

governmental

entities

through

various

products

and

services

includingloansandlinesofcredit,lettersofcredit,deposits, internationaltradefinanceandother

services. TheBusinessBank,whichincludesallbusinesscustomersexceptforsmallbusiness,

traditionallyaccountsforatleasttwothirdsofnetinterestincome.Inadditiontoservingtheneedsof

businesses,ComericaIncorporatedalsooffersavarietyofconsumerproducts,includingdeposit

accounts,installmentloans,creditcards,homeequitylinesofcreditandresidentialmortgageloans.

Fiduciaryservices,privatebanking,retirementservicesandotherwealthmanagementservicesarealso

provided.

Nationalgrowthhasbeenhamperedbyturmoilinthefinancialmarkets,declininghomevaluesand

risingunemploymentrates. Californialaggednationalgrowthprimarilyduetocontinuedproblemsin

the

states

real

estate

sector.

Michigan

continued

to

contract

for

a

fifth

consecutive

year.

The

sharp

declineincarsalesnationally,therestructuringintheautosectorandtherecessionnationallywere

majorfactorsholdingbacktheMichiganeconomy. Awidevarietyofeconomicreportsconsistently

showedthatTexascontinuedtooutperformthenationin2008,thoughgrowthclearlyslowedfromthe

rapidpaceseenin2007. Texascontinuedtobenefitfromitsenergysectorandamuchmoremodest

retrenchmentinhomebuildingthaninmostotherstates.

Duetotheaboveeconomicconditionsinourmarketsinthespringof2008,especiallyinCaliforniaand

Michigan,Managementbeganaprocessintendedtoreducebusinessloansandcommitmentsto

preservecapitalandgenerateappropriateloanpricingforcurrentrisks. Thiswasdoneasloanswere

renewed. Theprocesstookafewmonthstoimplementandwasinfulleffectbeginninginthesummer

of2008. Asaresult,loanswereexpectedtodecline$23billionfromJune2008toJune2009.Inthe

fourthquarter

2008,

with

the

receipt

of

TARP

proceeds,

Management's

focus

moved

toward

establishingnewandexpandingexistingrelationships,particularlyinSmallBusiness,MiddleMarketand

WealthManagementinTexasandCalifornia,withappropriatepricingandcreditstandards. Thechange

inManagementfocusisevidencedbyafourthquarter2008annualizeddeclineinaverageloansof1

percent,significantlylowerthanthethirdquarterannualizeddeclineof7percent.


29/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:COMERICAINCORPORATEDReportingmonth(s): OctNovDec2008

Submissiondate:1/30/09Persontobecontactedregardingthisreport:DarlenePersons

2

Overall,loandemanddeclinedinthefourthquarter2008,asbusinesscustomerscontinuedtobe

cautiousdue

to

the

deteriorating

economic

conditions

in

our

markets.

Commercial

lending

renewals

and

newcommitmentswere$7.5billionand$1.5billion,respectively,bothlowerthanthethirdquarter

2008.Newcommitmentsandrenewalswerelowerinthethreelargestmarkets(Midwest,Westernand

Texas),althoughnewcommitmentsdeclinedtheleastinTexas,alessweakeconomy.Therewere$380

millionofnewcommitmentsinconsumerlendinginthefourthquarter.

Residentialmortgagelendingwasfacilitatedthroughpurchasesofmortgagebackedsecuritiesand

throughlendingtocustomersinourMortgageBanker(partofCommercialRealEstate)andFinancial

ServicesDivisions.SincereceivingTARPproceeds,$2billionofmortgagebackedsecuritieswere

purchasedfordeliveryinthefirstquarterof2009. Inaddition,duringOctoberthroughDecember,2008,

$808millionofrenewalswerebookedintheMortgageBankerandFinancialServicesDivisions.

Debtunderwritingthroughourbroker/dealersubsidiaryduringthefourthquarterof2008of$7.0billion

providedaccesstoliquidityforcorporatecustomers.

Duringthefourthquarter2008,$1.3billionofauctionratesecuritieswerepurchasedfromcustomers,

assistingwithcustomerliquidity.


30/90


31/90


32/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:FifthThirdBancorpReportingmonth(s): OctNovDec2008

Submissiondate: 1/30/09Persontobecontactedregardingthisreport: BlaneScarberry

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.Companydescription: FifthThirdBancorpisadiversifiedfinancialservicescompanyheadquarteredinCincinnati,Ohio. AsofDecember31,2008,theCompanyhad$120billioninassets,operated18

affiliateswith1,307fullserviceBankingCenters,including92BankMartlocationsopensevendaysa

weekinsideselectgrocerystoresand2,341ATMsinOhio,Kentucky,Indiana,Michigan,Illinois,Florida,

Tennessee,WestVirginia,Pennsylvania,Missouri,GeorgiaandNorthCarolina. FifthThirdoperatesfive

mainbusinesses:CommercialBanking,BranchBanking,ConsumerLending,InvestmentAdvisorsand

Fifth

Third

Processing

Solutions.

Fifth

Third

is

among

the

largest

money

managers

in

the

Midwest

and,

as

ofDecember31,2008,had$179billioninassetsundercare,ofwhichitmanaged$25billionfor

individuals,corporationsandnotforprofitorganizations.

TheTreasury'spreferredstockinvestmentinFifthThirdwasmadeonDecember31,2008.Asaresult,

fourthquarterresultsdiscussedbelowdidnotincludetheeffectorbenefitofthepresenceofthose

fundsorcapital.

Consumer: Fourthquarteroverallloandemandfornonmortgageconsumercredit(homeequity,creditcardandauto)comparedtothirdquarterwasslightlyweaker,asexpected,particularlygivenseasonality

trends. Mortgageapplicationsincreasedsequentiallydrivenbyattractiveinterestrateswithinthe

agencyconforming

product

categories.

Duringthefourthquarter,FifthThirdcontinuedtomakeprudentadjustmentstoconsumerlending

standards,consistentwithpeerinstitutionsasreportedbytheFederalReserveandasobservedinthe

market. FifthThirdfocusedontighteningloantovaluerequirementswithinrealestatebacked

products,givenanoutlookforfurtherU.S.homepricedepreciation. FifthThirdalsoenhancedour

creditrequirementsfornonrealestatelendingduetoprojectedfurtherstresswithintheU.S.economy.

FifthThirdcontinuestolendtoqualifiedborrowers. InthemonthofDecember2008,weoriginated

morethan4,400mortgages,nearly3,500equityloansandover23,200autoloans.

Inthe

fourth

quarter

of

2008,

Fifth

Thirds

average

consumer

loans

and

leases

were

flat

from

the

third

quarter. Thisresultwasprimarilydrivenbythefirstmortgageportfoliowherethemajorityof

originationsaresoldintothesecondarymarket.


33/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:FifthThirdBancorpReportingmonth(s): OctNovDec2008

Submissiondate: 1/30/09Persontobecontactedregardingthisreport: BlaneScarberry

2

CRE:Average

CRE

balances

decreased

slightly,

down

$200

million

in

the

fourth

quarter

compared

with

thethirdquarter. FifthThirdcontinuestoengageinlendingonowneroccupiedproperties. FifthThird

continuestosuspendlendingonnewnonowneroccupiedpropertiesandonnewhomebuildersand

developerprojectsinordertomanageexistingportfoliopositions.Webelievethisisprudentgiventhat

wedonotbelieveaddedexposureinthosesectorsiswarrantedandgivenourexpectationsfor

continuednegativetrendsintheperformanceofthoseportfolios. Existingconstructionborrowersare

takingadvantageofminipermoptionsastheiroptionsforlongertermfinancinginthemarkethas

diminished.

C&I: LendingintheCommercial,BusinessBankingandPrivateBankingsegmentscontinuestoqualified

borrowersexhibiting

average

risk

or

better.

Continued

emphasis

is

placed

on

prudent

underwriting

and

demonstratedabilitytorepayasweareseeingcertainborrowerssalesweaken,profitmarginsnarrow

andthenumberofbusinessbankruptciesrise. Overall,loandemandisdownasweareseeingreduced

confidenceintheeconomyfromourC&Iborrowers,whichvariesbygeography. Customersare

deleveragingandincreasingliquiditythroughassetsalesandreducedinventoriesversusexpanding

operationsandpurchasingequipment.

DemandforSmallBusinesscreditisstillrelativelystablebutshowingsignsofweakeningasapplication

volumeisstartingtoslow. BusinessBankingloanoriginationscontinuetobemadeusingprudent

underwritingstandards. Inthefourthquarterof2008,weoriginatedorrenewedover$800millionof

loanbalancesrepresentingover3,000loans. Nearlyhalfofthosebalanceswereoriginatedorrenewed

inthemonthofDecember.

Theprimarymarketforsyndicatedcreditandlargecorporatedealshasslowedinthefourthquarteras

demandhasdecreased. Giventheoutlookfortheeconomy,manycompanieshavescaledbackplansfor

capitalexpendituresandinventorybuild,whichinturnhasreducedtheneedforfinancing. Mergerand

acquisitionactivityhasalsoslowedsignificantly. Termsandcovenantshavetightenedsomewhatand

spreadshavewidened,whichhasalsoservedtoreducedemand.

Averagetotalcommercialloanandleasebalancesgrew3percentforthefourthquartercomparedwith

thethirdquarter. Duringthefourthquarter,commercialloanandleaseaverageloansgrewby

approximately$1.7

billion

primarily

due

to

the

use

of

contingent

liquidity

facilities

related

to

certain

off

balancesheetprograms. Excludingtheseitems,commercialloanbalancesinthefourthquarterwere

consistentwiththirdquarterbalances.Duringthefourthquarter,$1.3billionincommercialloanswere

eithersoldortransferredtoheldforsale,buttherewasminimalimpacttoaverageloanbalancesdue

tothetimingoftheseactions.


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TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: TheGoldmanSachsGroup,Inc.Reportingmonth(s): OctNovDec2008

Submissiondate: January30,2009Persontobecontactedregardingthisreport:DavidA.Viniar

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.GoldmanSachsservesanumberofimportantrolesforourclients,includingthatofadvisor,financier,

marketmaker,riskmanagerandcoinvestor. Ourbusinessisinstitutionallydominated,withthevast

majorityofourcapitalcommitmentsmadeonbehalfofcorporations,governments, institutional

investors,likemutualfundsandpensionfundsandinvestingclientslikehedgefundsandprivateequity

firms.Wedonothavesignificantexposuretoconsumerlendingandretailcommercialbanking.

TheinvestmentgradenewissuemarketremainedessentiallyclosedthroughearlyOctoberandonly

reopenedat

mid

month

when

IBM

came

to

market.

Conditions

continued

to

be

fragile,

however,

withthemarketonlyopentobellwethernames.Novemberwasnotastrongmonthforissuance

thoughAltria'stransactionmarkedthefirstBBBissuesincethesummer.Creditspreadsbeganto

tighteninearlyDecemberwithadramaticincreasetowardtheendoftheyearandintothefirsthalf

ofJanuary.

Whiletheprimarymarketforhighyieldissuancehasgraduallyreopenedthusfarin2009for

seasonednamesindefensivesectors,lookingbacktolate2008,issuancewasminimal. InOctober,

therewasonlyoneprimaryissuea$750mmnotionalseniorsecuredofferingforMGMMirage.

TherewerenoprimaryissuesinthehighyieldmarketinNovember2008,thefirstmonthwithout

newissuance

since

March

1991.

Two

high

yield

transactions

came

to

market

in

December

2008.

ThehighyieldCDXindexreachedanalltimewidelevelattheendofNovember,asthesecondary

marketcontinuedtotradeoffamidstcontinuedcreditandmacroeconomicconcerns. Secondary

marketlevelsimprovedintotheendofDecember. Demandfordefensivenamesimproved,

howeverallothernamescontinuedtoremainunderpressure.

Theprimarymarketforcorporatebankloanswasessentiallyclosedduringthecalendarfourth

quarterof2008.Thenonagencymortgagesecuritizationmarketremainsessentiallyclosedtonew

issuance. Totheextentbanksaremakingjumboloans,theyarekeepingtheseloansontheirbooks.

Nonagencysecondarymarketliquidityhasdeterioratedduetouncertaintyoverthepotentialfor

bankruptcycram

downs,

though

liquidity

is

better

than

it

was

at

its

worst.

Agency

debenture

spreadshavetightenedwiththeimplementationoftheFedspurchaseprogram.

Municipalnewissuanceactivityinthefourthquarterwasimpactedbytheturmoilinthebroader

creditmarkets. Inparticular,institutionaldemandformunicipalsecuritieswascrimpedby

deleveragingandcreditrelatedlossessustainedbyinstitutionalinvestors. Theprimarysourceof


37/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: TheGoldmanSachsGroup,Inc.Reportingmonth(s): OctNovDec2008

Submissiondate: January30,2009Persontobecontactedregardingthisreport:DavidA.Viniar

2

demandformunicipalcreditswasretailrelated. TherewasnegligibleissuanceinOctoberthough

activitypicked

up

somewhat

toward

the

end

of

the

quarter.

Municipalities

were

hesitant

to

raise

freshfundsduetohigherborrowingcosts.


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40/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: JPMorganChase&CoReportingmonth(s): OctNovDec2008

Submissiondate:January30,2009Persontobecontactedregardingthisreport:AdamGilbert

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.A.ConsumerlendingOverallconsumerbalanceswerelittlechangedduringthe4thquarter.Ingeneral,consumerandsmallbusiness

applicationsforcreditdecreased.Approvalratesforconsumerloansremainedfairlyconstantthroughoutthe

quarter(slightlydeclining).

Firstmortgageoriginationsweredowninthequarterreflectingsignificantoveralldeclineinrealestatemarketactivity.Morerecently,refinancingapplicationsincreasedduetolowerratesasaresultofFederal

Reserveactions.Homeequityapplicationsdeclinedinthefourthquarterasaresultofmacroeconomic

factorsincludinghomepricedepreciation.Approvalratesformortgagesremainedfairlyconstant

throughoutthefourthquarter.DuringthequarterJPMCapprovedmorethan60,000mortgagesand

homeequityloansandlines.

Creditcardbalanceswereupslightly(2%higherinDecembervs.October).Overallapprovalratesremainedflat.Totalcommitmentsdecreased2%fromOctobertoDecember.DuringthequarterJPMC

approvedmorethan3.5millionnewcreditcardapplicationsandmorethan1millioncreditcardline

increases.

Applicationsforotherconsumerloans(smallbusiness,autoloansandeducation)declinedinthefourthquarter.Duringthequarter,JPMCapproved470,000autoloansand5,000smallbusinessloansandlines.

Approvalratesdeclinedslightlyduringthequarterformostproducts.Consumerunderwritingstandardsareregularlyadjustedbasedonchangesinconsumerbehavior,portfolioperformanceandtheexternal

environment,includinghomepricesandunemployment.Thus,overthelast18months,continuinginto

thefourthquarter,lendingstandardsweregenerallytightenedacrossmostconsumerproducts.

B.CommercialLending(C&IandCRE)Wholesale

balances

declined

3%

between

October

and

December.

Including

interbank

lending,

wholesale

balanceswere20%higherinDecembercomparedtoOctober.

Whiletherewerenomaterialchangesinunderwritingstandardsduringthe4thquarter,pricingandstructurewere

adjustedsomewhattoreflectthechangingenvironment.

Wholesalebalancesandoriginationsvolumetrendedlowerduringthequarter,affectedbythedeclineof

wholesalebusinessactivity.


41/90



2

ForLargeandMidcorporates,thedecreasewasprimarilydrivenbylowerdemandinthesecondarymarkets

for

loan

products

in

the

syndication

and

trade

finance

businesses.

In

addition,

customer

de

leveraginginlinewithhighermarketpricingofcreditriskhascontributedtolowerbalances.

Formiddlemarketcompanies,loandemandslowed,asevidencedbythedecliningnumberofproposalssubmitted(creditapplicationsamongmiddlemarketcustomersdroppedbymorethan50%inthelast

twomonthsoftheyear)andlowutilizationinthefourthquarter(i.e.,clientsweregenerallynotdrawing

additionalcreditonlinesthatwereavailabletothem).

Companiesacrossthespectrumareborrowinglessduetolowerworkingcapitalandfixedassetspendingrequirements. Lowermergersandacquisitionactivityalsodampenedbankloandemand. Fourthquarter

seasonalloandemandwasdrivendownfurtherbyweakretailsalesandreducedconsumerspending.

Declinesinwholesalebalancesaretypicalinarecession. Forexample,duringthe20012002recession,JPMC

wholesalebalancesdecreasedbymorethan10%between3Qand4Q01.

C.OtherintermediationactivitiesTheMatchedBookbusinesssawabroadbaseddeclineasclientsdeleveragedandrequiredlesssecuredfinancing.

Activityintheequitymarketswaslimitedinthefourthquarterduetomarketvolatilityandlackofinvestor

confidence,causingboththeIPOandconvertiblesmarketstoeffectivelycloseandlimitingvolumeinfollowon

issuesforthequarter.

Onthedebtside,theHighYieldoriginationmarketwasalsoeffectivelyclosedduetocontinuedmarketvolatility.

ManyHighGradenewissuesremainedonholduntillateinthequarter.CommercialdebtissuancesundertheFDIC

TemporaryLiquidityGuaranteeProgramcontributedsignificantvolumesinDecember.

E.OveralllendingsummaryGiventhisbackground,JPMCmaintaineda significantleveloflendingactivityinthe4thquarter,extendingover

$150billioninnewloansandlinestoretailandwholesaleclients,including:

Morethan$50billioninnewconsumeroriginations,intheformofcreditcards,mortgages,homeequityloansandlines,studentloansandautoloansrepresentingover5millionnewloansandlines

1to

consumers.

Morethan$20billioninnewcreditextendedto5,000smallbusinesses2and3,000midsizedbusinesses,1Includes~1millioncreditcardlineincreasesextendedduringthetimeperiod2SmallbusinessoriginationsincludenewandrenewedloansandlinesandareincludedaspartofConsumerLendingOther(ScheduleA,4b)


42/90



3

governmentsandnonprofits3.

Approximately$90billioninnewandrenewedcommitmentstoLargeCorporatesandJPMCsfullrangeofTreasuryandSecurityServicesandAssetManagementclients.

JPMCalsolentanaverageof$50billiontootherbanksthroughtheinterbankmarketprovidingadditional

liquiditytothesystem. Finally,duringthe4thquarter,JPMCpurchasedalmost$60billionofmortgagebackedand

assetbackedsecurities.

Inaddition,duringthe4thquarter,JPMC:

Tookanumberofsignificantstepstohelpmorehomeownersstayintheirhomes.o OnOctober31st,Chaseannouncedsignificantenhancementstoitsmortgagemodification

program,including: asystematicreviewofitsentireportfoliotoidentifyhomeownersmost

likelytorequirehelp;proactivemodificationoffersinwriting;24newChaseHomeownership

Centersinareaswithhighmortgagedelinquencies;andtheadditionofnewloancounselorsto

providebetterhelptotroubledborrowers,bringingthetotalnumberofcounselorstomorethan

2,500. Thiseffortisexpectedtohelp400,000homeownerswithatotalof$70billionworthof

Chaseownedmortgages.

o Morerecently,Chaseannouncedthatitwouldextenditsmortgagemodificationeffortstoinclude$1.1trillionofinvestorownedmortgagesitservices(includingthoseinsecuritizations).

Committed

to

extend

an

incremental

$5

billion

in

lending

to

the

state

and

local

government

and

non

profitsectorintheU.S.overthenextyear

Purchasedtheentireamountofa$1.4billionbondofferingtohelpthestateofIllinoisafteritpreviouslyfailedtoclearthemarkets.

3Newcommitmentsandrenewalofexistingaccounts.IncludedaspartofCommercial Lending(ScheduleB)


43/90

Nameofinstitution: KeyCorp Submissiondate: 1/30/09


2008


1.FirstMortgage

a.AverageLoanBalance(DailyAverageTotalOutstanding) $3,663 $3 ,667 $3,6 30 Firs tMortgageincludesloanssecuredby14familyresidentialpropertiesinclu

loanssecuredbyfirstliens.

b.Total

Originations $109 $114 $92 Total

Originations

include

both

portfolio

and

held

for

sale

loan

originations.

(1)Refinancings $54 $51 $44



1

2.HomeEquity

a.AverageTotalLoanBalance $7,773 $7,852 $7,941 HomeEquityincludeshomeequitylinesofcreditonly(Homeequityloanssecu

areincludedwithFirstMortgagesabove).


c.Total

Used

and

Unused

Commitments $16,294 $16,359 $16,411

3.USCard Managed

a.AverageTotalLoanBalance Managed $6 $6 $6 USCard ManagedincludesCreditCardloans.


c.TotalUsedandUnusedCommitments $48 $ 48 $ 49

4.OtherConsumer

a.AverageTotalLoanBalance 8,396 8,354 8,313 OtherConsumerincludesallothernonrevolvingconsumerloans.


1


44/90


45/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution: KeyCorpReportingmonth(s): OctNovDec2008

Submissiondate: 1/30/09Persontobecontactedregardingthisreport:RobertL.Morris

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.ClevelandbasedKeyCorpisoneofthenation'slargestbankbasedfinancialservicescompanieswith

assetsofapproximately$105billionatDecember31,2008. ThroughKeyBankandcertainother

subsidiaries,KeyCorpprovidesawiderangeofretailandcommercialbanking,commercialleasing,

investmentmanagement,consumerfinance,andinvestmentbankingproductsandservicesto

individual,corporateandinstitutionalclientsthroughtwomajorbusinessgroups,CommunityBanking

andNationalBanking. CommunityBankingincludestheconsumerandbusinessbankingorganizations

associatedwith

the

company's

14

state

branch

network.

The

branch

network

is

organized

into

four

geographicregions: Northwest,RockyMountains,GreatLakesandNortheast. NationalBanking

includesthosecorporateandconsumerbusinessunitsthatoperatefromofficeswithinandoutside

Key's14statebranchnetwork. ItsreachextendsacrosstheU.S.andto26countries.

GeneralOverall,loanbalancestrendedloweratyearend2008. Thefourthquarterof2008wascharacterizedby

thecontinuedgeneralweakeningofcreditdemandacrossallclientsegments. Keytightenedsome

additionalcreditstandardsduringthefourthquarter,subsequenttothetighteningofcreditstandards

duringthethirdquarter.

Keyslendingstrategiesfocusonservingtheneedsofexistingandnewrelationshipclientswhilebeingmindfulofriskrewardandstrategiccapitalallocation.

ConsumerOverallloandemandforconsumercredit(excludingresidentialfirstmortgageandcreditcard)was

weakerasistypicallythecaseforConsumerinthefourthquartercomparedtothethirdquarter,since

thefourthquartergenerallymarksaseasonallowpointfortheyear. Basedonthenumberof

applicationsreceivedbyKey,thedemandforconsumercreditduringthefourthquarterof2008was

moderatelyweakerthanthatexperiencedduringthefourthquarterof2007.

Duringthe

fourth

quarter

there

was

modest

tightening

of

Keys

consumer

credit

standards,

especially

pricingrelatedchangesasperformancebasedpricingnecessitatedincreasesinpracticallyallproducts.

ThistighteningofcreditalsoreflectstheelevatedcostoffundsthatKeyandothersinthebanking

industrycontinuedtoexperienceastheavailabilityoflongtermfundingremainedrestricted.


46/90



2

Residentialmortgagedemandwascomparabletothirdquarterlevelswithaspikeinrefinance

applicationsbeginning

in

December.

Prime

residential

mortgage

credit

standards

remained

unchanged

duringfourthquarter,afterconsiderabletighteninginpreviousquarters.

C&IBorrowercreditinquiriesdecreasedmoderatelyduringthefourthquarter. Loandemandwas

moderatelyweakerforlargeandmiddlemarketfirms. Forsmallerfirms,loandemandwassubstantially

weaker. Thedecreaseindemandwasattributedtodecreasingneedsforthefinancingofplant,

equipment,inventoryandaccountsreceivable. AlsocontributingtothedecreaseinKeysaverageC&I

loansduringthefourthquarterwereclientpaydownsmadeonpreviousdrawsasaresultofimproved

liquidityconditionsinthecommercialpapermarkets. Loandemanddeclinedwithallborrowers

includingthose

with

desirable

risk

profiles.

Keyhadpreviouslytakenactiontolimitand/ormanageitsexposuretohigherriskindustries. Duringthe

fourthquarter,anevenmorecautiousapproachwastakentolendingtotheseindustries. These

changeswerepromptedbytheunfavorableeconomicoutlook,worseningofindustryspecificproblems,

decreasedliquidityinthesecondarymarket,andbusinessdecisionsregardingthestrategicuseof

capital.

Considerablefocuswasplacedonpricingforriskduringthethirdquarter. Continuingintothefourth

quarter,creditlinecostsincreasedandpremiumswerechargedonriskierdeals. Theuseofinterestrate

floorsincommercialcreditagreementsalsobecamemuchmoreprevalentduringthefourthquarter

giventrendsinovernightand30dayLIBOR,andtheincreasedcostassociatedwithtermliquidity,

includingcustomerdeposits.

CommercialRealEstateCREloandemand,alreadyveryweak,wasevenweakerduringthefourthquarter. Thecollapseofthe

CMBSsecuritizationmarketduringthesecondhalfof2008,coupledwiththeeconomicconditionsand

CommercialRealEstatemarketoutlook,contributedtoaconsiderablereductioninCRElending

activities.

Duringthefourthquarter,KeycontinuedtotightenCREcreditstandardsandpriceforrisk. Refinancing

activitywasupinthefourthquarterasalternativeandpermanentfinancingmarkets,suchasCMBSand

LifeCompanies,

have

been

weak.

Primary

refinancing

activity

has

been

in

the

multi

family

space

with

FannieMae,FreddieMac,andFHAagencies.


47/90



3

UnderwritingEquityunderwritingactivitywaslowindustrywideduringthequarterduetoextrememarketvolatility

andpressureonvaluations. Overall,only32transactionscametomarketduringthequarter,withKey

beinginvolvedintwo,versusthe177transactionsperquarterpaceseenbetween2000and2008.

InvestorinterestintheinvestmentgradebondmarketpickedupinlateNovemberwiththesuccessof

theFDIC'sTemporaryLiquidityGuaranteeProgram. Themodestrallyincreditspreadsopenedthe

windowforlarge,wellknown,issuersofinvestmentgradebonds,howeverpooreconomicdataand

expectationsforweakfourthquarterearningsleftsomepotentialissuersofdebt,includinghighyield,

unabletoattractinvestors.


48/90


49/90


50/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:Marshall&IlsleyCorporationReportingmonth(s): OctNovDec2008

Submissiondate:1/30/09Persontobecontactedregardingthisreport:GregoryA.Smith

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivity.Marshall&IlsleyCorporationisadiversifiedfinancialservicescorporationheadquarteredinMilwaukee,

Wis.,with$63.8billioninassets,$50.2billioninloansandleases,and$7.7Binshareholderequity.M&I

Marshall&IlsleyBankisthelargestWisconsinbasedbank,with193officesthroughoutthestate. In

addition,M&Ihas53locationsthroughoutArizona;32officesinIndianapolisandnearbycommunities;

34officesalongFloridaswestcoastandincentralFlorida;15officesinKansasCityandnearby

communities;

25

offices

in

metropolitan

Minneapolis/St.

Paul,

and

one

in

Duluth,

Minn.;

and

one

office

inLasVegas,Nev.M&IsSouthwestBanksubsidiaryhas17officesinthegreaterSt.Louisarea.

ThecommunitiesandcustomersM&Iservescontinuetofaceimpactsfromcurrentrecessionary

conditionsoftheeconomy. Nonetheless,M&Ihasincreasedlendinginthemarketsweserveandhas

effectivelygrownthebalancesheetgrossof4thquarterchargeoffsandloansalesforanetgainof$437

millioninthe4thquarterof2008.

WeareaggressivelyaddressingourhousingrelatedconstructionissuesinFloridaandArizona;and

during2008wesoldapproximately$780millioninproblemloans.Weexpectthatthebulkofour

Floridachallengesarenowbehindus,andwecontinuetodevoteextraordinaryresourcestoaddressour

Arizonaconstruction

challenges.

InCommercialRealEstate,wecontinuetoseelessinvestoractivityinnewconstructionprojects,with

multifamilyandmedicalofficebeingleastimpacted. Longtermfixedratenonrecourseloansreflect

thelackofliquidityintheCMBS/Conduitmarket. Asaresult,somematuringBankCREfinancingwhich

wouldhavepaidoffuponcompletionofconstructionandleaseupwillhavetobeextendedtoprovide

aninterimsolution.

Weexpectsoftnesstocontinuethroughout2009inC&Ilending. Decliningeconomicconditionshave

resultedinborrowersreducingexpensesandpayingdowndebt,delayingcapitalexpenditureprograms,

experiencingdeclinesinworkingcapitalassets,andnotengaginginacquisitionactivities. Allofthese

factorsreducecustomerborrowingactivity. Additionally,existingcustomersthathavehistoricallybeen

largeseasonalborrowers,suchascontractors,agriculturebasedcompanies,andretailershavereduced

borrowinglevelsasaresultofsoftnessintheirownmarkets. Competitionforcreditbusinessfromother

financialinstitutionstillexists,particularlyfortraditionalcommercial&industrialcompanies.


51/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:Marshall&IlsleyCorporationReportingmonth(s): OctNovDec2008

Submissiondate:1/30/09Persontobecontactedregardingthisreport:GregoryA.Smith

2

Consumerbusinesseshavealsobeenimpactedbytheeconomicdownturn. Consumersareexperiencing

reducedcapacity

to

borrow

as

aresult

of

lower

household

income

due

to

lower

wages

and/or

the

loss

of

twoincomeearners,resultinginlowercreditscoresasincomehasbeentighter(highercreditlineusage

andpaymentissues).Lossofhomeequityandtighterindustryunderwritinghasalsoreducedthe

consumer'sabilitytoborrow.M&Ihasfocusedontransitioningtheresidentialmortgageoriginations

frombalancesheettosecondarymarketlending.

OurWealthManagementbusiness,withassetsundermanagementof$30.4billionandassetsunder

administration$104.4billion,hasfacedheadwindsinthefourthquarter. Theprimaryissueswere

overallequitymarketdeclinesandtheshiftingofhigherfeeassetsintocashequivalents. Lookingatthe

components,ourTrustbusinessesarereflectiveofgeneralmarketconditions. Salesactivitiesslowed;

however,pipelines

remained

at

levels

comparable

to

the

prior

quarter.

Outsourcing

revenues

continuedtogrowwiththeadditionofnewclients,andpipelineopportunitiesremainstrongfor2009.

M&Ihasalsoworkedtoprovideintermediaryactivitiesforourclientsandthefinancialmarketsasa

whole.

M&Ihasprovidedliquidityforinvestmentcustomerswhowereholdingsecurities,butbecauseofrecentmarketdisruptions,wereunabletosellthesesecurities.

M&Ihasproactivelysupportedtheissuersofvariableratedemandnotes(VRDN)backedbythebanksLC. Thisincludesprovidingliquiditytothemarketbypurchasingnotesthatwere"put"or

tendered.Additionally,

borrowings

tied

to

the

disruption

in

the

VRDN

market

were

paid

off

in

October,2008,astheVRDNmarketstabilizedandtradingnormalized.

M&Ihasimplementedafranchisewideforeclosureabatementprogramdesignedtokeepfamiliesintheirhomes,includinga90dayforeclosuremoratoriumoncertainowneroccupied

residentialloans.


52/90

Nameofinstitution: MorganStanley Submissiondate:1/30/2009


2008


1.FirstMortgage

a.AverageLoanBalance(DailyAverageTotalOutstanding)

$4,748 $4,692 $4,581

Consistsof(14family)residentialwholeloansoriginatedbyorpurchasedfrom

brokers.

Note:amountsaremonthendbalances.

b.Total

Originations

$0 $0 $0

(1)Refinancings

$0 $0 $0

(2)NewHomePurchases

TREASURYMONTHLYINTERMEDIATIONSNAPS

1

$0 $0 $0

2.HomeEquity


$2,625 $2,601 $2,500

HomeEquityLinesOfCredit,consistingofloansoriginatedbyorpurchasedfro

brokers.

Note:amountsaremonthendbalances.

b.Originations (NewLines+LineIncreases)

$0 $0 $0


$0 $0 $0

3.USCard Managed

a.AverageTotalLoanBalance Managed

$0 $0 $0

b.NewAccountOriginations(InitialLineAmt)

$0 $0 $0


$0 $0 $0

4.OtherConsumer


$5,861 $5,845 $5,874

ConsistsofNonPurposeLoans(loansexcludingMarginlending),andSmallBus

Note:amounts

are

month

end

balances.

b.Originations

$185 $235 $237

1


53/90


54/90

TREASURYMONTHLYINTERMEDIATIONSNAPSHOTNameofinstitution:MorganStanleyReportingMonth(s):OctNovDec2008

Submissiondate:01/30/2009Persontobecontactedregardingthisreport:FredGonfiantini

1

PARTII. QUALITATIVEOVERVIEWPleaseprovideabriefoverviewoftheintermediationactivityduringthemonth. Thisdiscussionshouldincludeageneralcommentaryonthelendingenvironment,loandemand,anychangesinlendingstandardsandterms,andanyotherintermediationactivities(suchasassetpurchases).COMMENTARY: During 2008, a severe downturn in the economy led to price declines and a period of

unprecedentedvolatilityacrossvariousassetclasses. Losses thatbegan in2007with the

subprime mortgage sector, spread in 2008 to the residential and commercial mortgage

marketsandthecreditmarketsingeneral. Themagnitudeofthesedeclinesledtoacrisisof

confidenceinthefinancialsectorasaresultofconcernsaboutthecapitalbaseandviability

ofcertainfinancialinstitutions. Duringthisperiod,interbanklendingandcommercialpaper

borrowingfell

sharply,

precipitating

acredit

freeze

for

both

institutional

and

individual

borrowers.

ThelandscapeoftheU.S.financialservicesindustrychangeddramatically,especiallyduringthe fourthquarterof2008. In theU.S.,creditconditionsworsenedconsiderablyoverthe

courseoftheyear,andtheU.S.enteredintoarecessionandthecreditcrisisassumedglobal

proportions. Concernsaboutfutureeconomicgrowth,lowerlevelsofconsumerspending,a

high rateofunemploymentand lowercorporateearningscontinued tochallenge theU.S.

economyandtheequitymarkets.

Overall,ourcapitalpositionhasallowedMorganStanleytoparticipateindebttransactionsthatraisedatotalof$56Bn forclientsandanadditional$10Bn forMorganStanley inthe

quarterandequitytransactionsthatraisedatotalof$40Bn inthequarter. Italsoallowed

ustoapprove$10.6Bninnewloansduringthequarter. However,demandfromclientsand

investors for credit and equity is still down significantly fromprior years. The following

qualitativeanalysis isprovidedtobetterdescribeMorganStanleysrole inandassessment

ofthefinancialandlendingmarketsforthefourthquarterof2008:

DEBTUNDERWRITING:October2008

October issuanceswere relatively light;marketvolumesweredown21% fromSeptemberandthenumberofissuanceswasdown23%fromSeptember.

MorganStanleyunderwroteapproximately10%ofU.S.dollardenominateddebtraised(anincrease of 274% from the priormonth) predominately as a result of our role inmajor

issuancesfor

Pepsi/Pepsi

Bottling

($3.3Bn),

and

Verizon

Communications

($3.3Bn).

There were no financial issuances as issuers did not begin using the FDICs TemporaryLiquidity Guarantee Program (TLGP) until November. New issue premiums remained

relativelyelevated(inthe75100bpsrange).

November2008

New issueactivitypickedup inNovember,primarilydue to theadditionofTLGP supply.Goldman Sachs ($5Bn) was the first to tap the government guaranteed market on


55/90



2

November 25, followed by Morgan Stanley ($5.8Bn), and JPMorgan ($6.5Bn). Market

volumeswere

up

23%.

Morgan Stanley participated in several large corporate issuances. Morgan Stanleyunderwrote approximately16%ofU.S.dollardenominateddebtraised(anincreaseof62%

fromthepriormonth) including$2Bn forTimeWarnerCable,$3.5Bn forVerizonWireless

and$3Bn forBPCapitalMarkets. New issuepremiums remainedelevated (in the75bps

range).

December2008

ThebreadthofnewissuebusinessinDecemberwasstrong. TLGPissuanceswereactiveandnewcorporateissuepremiumscamedownsignificantly(4050bps). Marketvolumeswere

up155%andthenumberofissuancescompletedwasup33%.

Morgan Stanley underwrote approximately 10% ofU.S. dollar denominated debt raised.MorganStanleywasabletounderwriteissuancesforclientsinboththehighyielddebtandemerging market debt markets effectively opening these markets to the issuers. On

December 9, we priced a $500MM offering for El Paso Corp (rated Ba3/BB) and on

December15,wepriced$190MMforKansasCitySouthernRailway(ratedB2/BB).

EQUITYUNDERWRITING:October2008

MorganStanleyassistedclientsinraisingnearly$17BninequitycapitalinOctober. MorganStanleyunderwroteapproximately11%ofallequitycapitalraisedgloballyinOctober. This

includedthelargesttransactionofthemonth,a$12BnissuancebyGeneralElectric.

Equity issuances in the market were weighted towards the beginning of the month ofOctober,dominatedbyGeneralElectric(whichincludedanadditional$3Bnpreferredstock

investmentbyBerkshireHathaway)andBankofAmericas$10Bninselfissuance.

Pricing discounts were deep with Bank of America and MetLife both pricing downapproximately30%fromannouncementofthetransactions.

November2008

MorganStanleyassistedclientsraise$13.5billioninequityinNovember. MorganStanleyunderwroteapproximately7%ofallequity raisedgloballya lower level

than in October because we did not participate in two large European rights issuances

totalingnearly$20Bn. Wedidactasjoint leadunderwriter in the largestofferingof the

month,a$13Bn

follow

on

for

Wells

Fargo,

and

as

lead

underwriter

on

the

only

two

utility

offeringsinthemonth.

DemandforequityissuanceinthemarketsawaslightimprovementasWellsFargowasableto secure nearly $13Bn in financing at amodest discount, AnheuserBusch InBev raised

$9.9Bnthrougharightsoffering,andHenkelwasabletosellnearly$2BnofEcolab. Grand

CanyonEducation raised$145MM in the lastUS IPOof the year thoughatnearlya40%

discounttotheoriginalfilingrange.

Equity indices continued their decline to lose 11% on themonth, hinderingwidespreadaccesstotheprimaryequitymarkets.


56/90



3

December2008

Morgan Stanley served as leadunderwriter for 10 transactions helping clients raiseover$10Bninequity. MorganStanleyunderwroteapproximately9%ofallequityraisedglobally.

Equity issuance across the globalmarkets gained 20%by numberof issuanceswhile theaveragesizedecreasedas issuersofvarying sizesand industries launchedofferings intoa

risingmarket. TheS&P500gained11.5% inthe firsttwoweeksofDecemberprovidinga

strengtheningbackdropforequityissuers.

SECUREDLENDING: As part of the Firms institutional business, Morgan Stanley enters into secured

lending/financingtransactions

where

it

loans

cash

or

securities

and

receives

securities

or

cashascollateral for loans. Ingeneral,secured lendingdoesnot requirea largeneed for

fundingasthecollateralreceivedinthelendingtransactionisusedtofinancetheloan.

MorganStanleyssecured lending isgenerallyperformedaspartof itsMatchedBookandPrimeBrokeragebusinesses.TheMatchedBookbusinesssawabroadbaseddecline inthe

fourthquarterof2008asclientsdeleveragedandrequiredlesssecuredfinancing.Similarly,

MorganStanleysPrimeBrokerageclients(primarilyhedge funds)reduced leverageduring

thisperiodduetotheextremevolatilityandsharpdeclinesintheequitymarkets.

MBS/ABS:

Morgan

Stanley

su

m&i loss mitigation representative wisconsin short sale

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