| Filed by Wachovia Corporation pursuant to Rule 425 under the Securities Act of 1933, as amended, and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934, as amended | ||
| Subject Company: SouthTrust Corporation | ||
| Commission File No.: 333-117283 | ||
| Date: September 8, 2004 | ||
This filing contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, with respect to each of Wachovia Corporation, SouthTrust Corporation and the combined company following the proposed merger between Wachovia and SouthTrust, as well as the goals, plans, objectives, intentions, expectations, financial condition, results of operations, future performance and business of Wachovia, including, without limitation, (i) statements relating to the benefits of the merger, including future financial and operating results, cost savings, enhanced revenues and the accretion or dilution to reported earnings that may be realized from the merger, (ii) statements relating to the benefits of the retail securities brokerage combination transaction between Wachovia and Prudential Financial, Inc. completed on July 1, 2003, including future financial and operating results, cost savings, enhanced revenues and the accretion of reported earnings that may be realized from the brokerage transaction, (iii) statements regarding certain of Wachovia’s and/or SouthTrust’s goals and expectations with respect to earnings, earnings per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (iv) statements preceded by, followed by or that include the words “may”, “could”, “should”, “would”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, “projects”, “outlook” or similar expressions. These statements are based upon the current beliefs and expectations of Wachovia’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. These forward-looking statements involve certain risks and uncertainties that are subject to change based on various factors (many of which are beyond Wachovia’s control).
The following factors, among others, could cause Wachovia’s or SouthTrust’s financial performance to differ materially from that expressed in such forward-looking statements: (1) the risk that the businesses of Wachovia and SouthTrust in connection with the merger or the businesses of Wachovia and Prudential in the brokerage transaction will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings from the merger or the brokerage transaction may not be fully realized or realized within the expected time frame; (3) revenues following the merger or the brokerage transaction may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption
following the merger or the brokerage transaction, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the ability to obtain governmental approvals of the merger on the proposed terms and schedule; (6) the failure of Wachovia’s or SouthTrust’s shareholders to approve the merger; (7) the strength of the United States economy in general and the strength of the local economies in which Wachovia and/or SouthTrust conducts operations may be different than expected resulting in, among other things, a deterioration in credit quality or a reduced demand for credit, including the resultant effect on Wachovia’s and/or SouthTrust’s loan portfolio and allowance for loan losses; (8) the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; (9) inflation, interest rate, market and monetary fluctuations; and (10) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) and the impact of such conditions on Wachovia’s capital markets and capital management activities, including, without limitation, Wachovia’s mergers and acquisition advisory business, equity and debt underwriting activities, private equity investment activities, derivative securities activities, investment and wealth management advisory businesses, and brokerage activities. Additional factors that could cause Wachovia’s and SouthTrust’s results to differ materially from those described in the forward-looking statements can be found in Wachovia’s and SouthTrust’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC. All subsequent written and oral forward-looking statements concerning Wachovia or the proposed merger or other matters and attributable to Wachovia or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Wachovia and SouthTrust do not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this filing.
The proposed merger will be submitted to Wachovia’s and SouthTrust’s shareholders for their consideration, and, on August 31, 2004, Wachovia filed an amended registration statement on Form S-4 with the SEC containing a preliminary joint proxy statement/prospectus of Wachovia and SouthTrust and other relevant documents concerning the proposed merger. Shareholders are urged to read the definitive joint proxy statement/prospectus regarding the proposed merger when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. You will be able to obtain a free copy of the registration statement and the joint proxy statement/prospectus, as well as other filings containing information about Wachovia and SouthTrust, at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, at www.wachovia.com under the tab “Inside Wachovia—Investor Relations” and then under the heading “Financial Reports—SEC Filings”. You may also obtain these documents, free of charge, at www.southtrust.com under the tab “About SouthTrust”, then under “Investor Relations” and then under “SEC Documents”. Copies of the joint proxy statement/prospectus and the SEC filings that will be incorporated by reference in the joint proxy statement/prospectus can also be obtained, without charge, by directing a request to Wachovia Corporation, Investor Relations, One Wachovia Center, 301 South College Street, Charlotte, NC 28288-0206, (704)-374-6782, or to SouthTrust Corporation, P. O. Box 2554, Birmingham, AL 35290, (205)-254-5187.
Wachovia and SouthTrust, and their respective directors and executive officers, may be deemed to be participants in the solicitation of proxies from the shareholders of Wachovia and SouthTrust in connection with the proposed merger. Information about the directors and executive officers of Wachovia and their ownership of Wachovia common stock is set forth in the proxy statement, dated March 15, 2004, for Wachovia’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Information about the directors and executive officers of SouthTrust and their ownership of SouthTrust common stock is set forth in the proxy statement, dated March 8, 2004, for SouthTrust’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the definitive joint proxy statement/prospectus regarding the proposed merger when it becomes available. You may obtain free copies of these documents as described in the preceding paragraph.
The following materials are being used from time to time by Wachovia in presentations to investors
Wachovia Corporation Investor Update September 2004 Bob Kelly, CFO
Wachovia in perspectiveDiversified scale businesses
Bank under
1,508 $179 Corporate & Investment $ Wealth Management
$4,944 million 4%
30% $548 Parent $33 1% 11% Capital Management
TTM Segment Earnings* — 54% Represents net income available to common shareholders; segment earnings prepared
General Bank $2,676 #3725 IR Update
–
* Trailing twelve months as of June 30, 2004. generally accepted accounting principles exclude merger-related and restructuring expense, which equaled $253 million after-tax. Page 1
• Rank Banks
• #3 #3 #18 U.S. #3 #4 #2 #7 U.S. of #3 millions) ($
• Revenues $5,005 $2,819 $527 $2,606
• YTD 2004 banking) reps assets Banking) AUM issues/deals.
• businesses Bank of
• perspective commercial ATMs registered in (Private client agency clients number in and billion billion lead scale 4,400 10,800 on $104 $60 insurance Investment based Lines business funds: clients, and securities* ranking Bank branches, Brokerage: middle-market syndications* management table Update
• small Management Management yield* league IR
• Business #3725 2,500 Retail Mutual 67,000 Commercial 2,600 Preferred Loan Cash High –
• 2004 2
• WachoviaDiversified Key General (Retail, Capital • • Wealth • • Corporate • • • • • *YTD Page
Wachovia in perspectiveVast distribution network
Wachovia Financial Centers
SouthTrust Financial Centers
Wachovia Brokerage Offices
*Pro forma for SouthTrust transaction scheduled to close 4Q04.
Page 3 #3725 IR Update –
Wachovia in perspectiveRevenue and earnings* momentum
2Q04 vs. 2Q03 Growth
General Bank 5% 16%
Wealth Management 13% 49%
Corporate and Investment Bank 18% 56%
Capital Management 63% 44%
Revenue Earnings*
*Represents net income available to common shareholders excluding merger-related and restructuring expenses.
Page 4- #3725 IR Update
Service momentum
Superior customer service
Customer Satisfaction Scores*
20% 5.59 1Q99
6.13 1Q00
6.29 t s 1Q01
6.38 A 2Q02
6.54 n 2Q03
6.57 12% 2Q04
Led 2003 American Customer Satisfaction Index-
University of Michigan
Score 2003 vs. 2000
Wachovia 76 +15.2%
Bank of America 74 +17.5%
Bank One 70 0.0%
Wells Fargo 68 +1.5%
All Others 76 +5.6%
*Data is from independent studies conducted with customers who transact in our
Financial Centers. Scores prior to 1Q02 for legacy First Union only. Scale of 1–7.
Page 5 #3725 IR Update
Retail & Small BusinessL
everaging proven success
Revenue per Financial Center
($ inthousands)
$743 2Q04 $704 1Q04 $687 4Q03 $714 3Q03 % 8 $691 2Q03
+28
$645 1Q03
$648 4Q02
$615 3Q02 $606 2Q02
$581 1Q02
Page 6 #3725 IR Update
–
Moving forward
Strategically focused on managing for growth
Focus on maintaining employee engagement
Focus on building customer loyalty
Focus on execution of revenue growth strategies
Focus on improving cost structure and operating efficiencies
Focus on financial strength and corporate governance
Focus on SouthTrust merger approval and successful merger integration
Page 7 IR #3725
SouthTrust rationale
Creates $1 billion of shareholder value for WB shareholders based on announcement assumptions in June 21investor deck
Upside shareholder value potential exceeds $1.6B including achievable revenue synergies
Strengthens competitive positioning in fast growing Southeast
Provides additional scale and growth opportunities to General Bank
Offers significant revenue synergies , yet none are assumed
Deepens and expands base of key human capital
Extends General Bank’s footprint
Accelerates Texas strategy
Expense efficiencies reasonable and achievable
Low-risk integration
Clean, straightforward systems environment
Vast majority of integration activities are GBG related
Only two deposit conversions required
Integration plans further along than WB/FTU integration at this point in timeline
Capacity considerations require less system analysis and allows for handling of more accounts for less cost
Page 8 #3725 IR Update
SouthTrust opportunity Retail & Small Business:further leverage the sales culture
Branch revenue lift estimated at $175 million/year
100% Goal
53% Small Business Loans
48% Retail Checking
37%Investment Sales
22% Consumer Loans
Business: Average SouthTrust branch production
as a% of an average Wachovia branch*
*Branch production estimates as of 1Q04.
Page 9 #3725 IR Update
SouthTrust opportunity Commercial: further leverage the sales culture
Avg. SouthTrust a % ofavg. WB outstandings/RM*outstandings/RM
Additional product opportunities
Treasury Services
Penetration of Small Business segment is 50% of that of Wachovia’s
Derivatives
New product opportunity
Commercial Real Estate Securitizations
New product opportunity
Permanent Real Estate Loan Placement
New product opportunity
100% Goal
67% Loans
22% Deposits
*Commercial outstanding estimates as of 2Q04. Treasury Services Annual Revenues/Commercial Loans Outstanding
Page 10#3725 IR Update
SouthTrust is a less complexconversion than Wachovia/First Union
Number system applications requiring conversion 1,100
600
45% fewer systems to convert
Number of accounts requiring conversion (in millions) 5.2 2.3
55% fewer accounts to convert
Transaction volumes as a% of legacy company 40% 10%
Lower transaction volumes as a% of acquiring company will result in minimal needs for capacity expansion
Number of regional conversions 4 2
50% fewer regional conversions
Wachovia/ First Union Wachovia/ SouthTrust
–
Page 11 #3725 IR Update
Cautionary statement
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements about the benefits including future financial and operating results, cost savings, enhanced revenues, and accretion to reported earnings that may be realized from the merger; (ii) statements with respect to Wachovia’s and SouthTrust’s plans, objectives, expectations and intentions and other statements that are not historical facts; and (iii) other statements identified by words such as “believes”, “expects”, “anticipates”, “estimates”, “intends”, “plans”, “targets” Wachovia’s and SouthTrust’s management and are subject to significant risks and uncertainties. forth in the forward-looking statements.
of the merger between Wachovia Corporation and SouthTrust Corporation, These statements are based upon the current beliefs and expectations of Actual results may differ from those set and SouthTrust will not be integrated governmental agencies that are not States economy in general and the Additional factors that could All subsequent written and oral forward-looking statements concerning the proposed Wachovia and SouthTrust do not undertake any obligation to update any forward-and similar expressions.
The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in such forward-looking statements: (1) the risk that the businesses of Wachovia successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings from the merger may not be fully realized or realized within the expected time frame; (3) revenues following the merger may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption following the merger, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the ability to obtain governmental approvals of the merger on the proposed terms and schedule and without greater divestitures than anticipated; (6) the failure of Wachovia’s and/or SouthTrust’s shareholders to approve the merger; (7) enforcement actions by currently anticipated; (8) competitive pressures among depository and other financial institutions may increase significantly and have an effect on pricing, spending, third-party relationships and revenues; (9) the strength of the United strength of the local economies in which the combined company will conduct operations may be different than expected resulting in, among other things, a deterioration in credit quality or a reduced demand for credit, including the resultant effect on the combined company’s loan portfolio and allowance for loan losses; (10) changes in the U.S. and foreign legal and regulatory framework; and (11) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate
conditions) and the impact of such conditions on the combined company’s capital markets and asset management activities. cause Wachovia’s and SouthTrust’s results to differ materially from those described in the forward-looking statements can be found in Wachovia’s and SouthTrust’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission. transaction or other matters and attributable to Wachovia or SouthTrust or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements referenced above. looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made. –
Page 12#3725 IR Update
Additional information
under the tab “Inside com
. You may also obtain these documents, free and then under “SEC Documents”. wachovia Additional information regarding the
. Information about the directors and executive Information about the directors and executive
You will be able to obtain a free copy of the registration statement and the joint proxy www SEC Filings”. under the tab “About SouthTrust”, then under “Investor Relations” and then under the heading “Financial Reports -com
You will also be able to obtain these documents, free of charge, at .
). southtrust gov .
. Investor Relations” www sec
. #3725 IR Update
The proposed merger between Wachovia Corporation and SouthTrust Corporation will be submitted to Wachovia’s and SouthTrust’s shareholders for their consideration, and on August 31, 2004, Wachovia filed an amended registration statement on Form S-4 with the SEC containing a preliminary joint proxy statement/prospectus and other relevant documents concerning the proposed transaction. Shareholders are urged to read the definitive joint proxy statement/prospectus regarding the proposed transaction when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. statement/prospectus, as well as other filings containing information about Wachovia and SouthTrust, at the SEC’s Internet site (http://www Wachovia – of charge, at Copies of the joint proxy statement/prospectus and the SEC filings that will be incorporated by reference in the joint proxy statement/prospectus can also be obtained, without charge, by directing a request to Wachovia Corporation, Investor
Relations, One Wachovia Center, 301 South College Street, Charlotte, NC 28288-0206, (704)-374-6782, or to SouthTrust Corporation, P. O. Box 2554, Birmingham, AL 35290, (205)-254-5187. Wachovia and SouthTrust, and their respective directors and executive officers, may be deemed to be participants in the solicitation of proxies from the shareholders of Wachovia and SouthTrust in connection with the merger. officers of Wachovia and their ownership of Wachovia common stock is set forth in the proxy statement, dated March 15, 2004, for Wachovia’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. officers of SouthTrust and their ownership of SouthTrust common stock is set forth in the proxy statement, dated March 8, 2004, for SouthTrust’s 2004 annual meeting of shareholders, as filed with the SEC on a Schedule 14A. interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the definitive joint proxy statement/prospectus regarding the proposed transaction when it becomes available. You may obtain free copies of these documents as described above. –
Page 13