Wachovia Corp New
Wachovia Corp New — Golden West Financial — Merger or Acquisition (May 2006)
54 slides from Wachovia Corp New's merger presentation, May 16, 2006
Slide 1: Rule 425 filing and forward-looking statements
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: Golden West Financial Corporation Commission File No.: 1-4629 Date: May 16, 2006 This filin
Slide 2: Forward-looking statements (continued)
more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings from the Merger or the Westcorp Transaction may not be fully realized or realized within the expected time frame; (3) revenues following the Merger or the Westcorp Transaction may be lower than ex
Slide 3: Additional information and participants in solicitation
filings that will be incorporated by reference in the proxy statement/prospectus can also be obtained, free of 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 Golden West, Attn:
Slide 4: Wachovia Corporation UBS Global Financial Services Conference
Wachovia UBS May Ken Chairman Thompson 16, Global 2006 and Corporation Financial CEO Services Conference
Slide 5: Delivering sustainable organic growth
Delivering –Sustainable Organic Golden *Represents Page Record Operating 1 –West growth #4623, revenues sustainable growth EPS net Financial resulted sustained income UBS growth on driven strong growth provides available in ofby by strong 9%* fee reinvesting focus attractive growth to momentum on co
Slide 6: Delivering disciplined growth 1Q06
Delivering Disciplined 1Q06 General 14% Capital Wealth 16% Corporate 11% Revenue *Segment Page 24% 3% 21% -5% 2vs. –Management Bank #4623, Earnings 1Q05 and earnings sustainable execution Investment Growth UBS exclude =growth Strong Bank merger-related organic earnings and restructuring growth expen
Slide 7: Superior customer loyalty drives organic growth
Superior WB Top 2005 Score Wachovia All Bank JPM/Bank Wells Percentage 43.2% 1Q03 *Data Goal likelihood PageOthers 10 led 3American vs. of 1Q04 Fargo is47.0% –among survey America from 2000 customer #4623, 79 to 78 One Loyal 1Q05 67 recommend, +19.7%(#1) 49.9% +8.3% independent all for 0.0% Customer
Slide 8: General Bank sales and production growth
General Same Deposit $3,765 +23% Loan $2,951 +20% *Same Deposits Loans Revenue* ($ $657 +15% 1Q05 *Total 1Q06 Page in thousands) 4$706 Production Store 1Q06 2Q05 results defined Retail –store $4,625 $3,549 Production Bank #4623, defined per $733 Sales 3Q05 sales exclude &Financial sales asSmall UBS
Slide 9: Strong sales culture drives production
GBG45% Strong High Success 25% +72% *Legacy Legacy 22% +105% Merger *4Q05 Page 43% 5branch leveraging sales –legacy Wachovia 1SouthTrust drivers Wachovia #4623, yr 116% post-merger culture productivity SouthTrust include UBS a Loan powerful Loan production drives consistent Production (Merger*) Prod
Slide 10: Capital Management recurring revenues
Capital 11% Managed $68 39% Recurring $1.3 2003 *Excluding Goal Page $82 $2.1 13% 50% 62004 –Management $106 #4623, Account $2.3 16% 55% Revenues Revenues* 2005 referral $120 $0.7 17% 57% UBS 1Q06 Assets fees 20-25% 70% as focus ($2007 a in % asbillions) ($on of in a% managed Total billions) of Tota
Slide 11: Wealth Management focus on relationships
Wealth Quarterly Core $13,303 +9% $12,829 +21% Loans Assets ($ $64.6 +6% 1Q05 Page in billions) millions) 7Deposits 1Q06 2Q05 $64.9 Under –Management’s $14,557 $15,526 #4623, Balances 3Q05 $65.6 Management UBS 4Q05 $65.6 focus 1Q06 $68.3 on relationship management drives organic growth
Slide 12: CIB's focus on relationships
CIB’s Net 14 +79% *Net Syndication ($ $3.6 +250% 1Q03 *Based Page in 25 New $6.3 billions) 8new 1Q04 22 focus –on #4623, 25 Lead $10.4 lead syndication 1Q05 on Volumes* relationships Relationships* building $12.6 UBS 1Q06generated lead corporate deal that have dollar bylead net generated volumes. re
Slide 13: CIB market share gains
CIB’s9Yield Wachovia (based 1.3% TOTAL Converts 0.3% Equity 0.5% High 3.0% 0.2% 0.0% M&A Preferreds 2000 Sources: Loan Page Grade 2005 market Syndications 3.5% 0.7% 2.8% 5.4% 2.9% 6.0% 3.2% 6.7% market on – #4623, Converts lead Market 1Q06 4.0% 1.2% 6.8% 6.9% 3.1% 7.4% 3.2% 10.3% share share deal UB
Slide 14: Wachovia Partnership cross-selling
Wachovia’s Wachovia WCP ($ $30 2003 New Partnership Retail Commercial CIB Product Page in$116 to millions) Revenue 10 2004 Revenue toand Cross-selling –and $180 #4623, Client 2005 from Revenue focus to from Production Goal and 1Q06 Wealth Partnership UBS on Wealth from $54 Opportunity cross-enterpri
Slide 15: Overhead efficiency improvement
Overhead 63.6% 2001 *Overhead 2007 Page 11 2002 not 59.1% –aefficiency* #4623, projection; 2003 efficiency 60.6% 2004 UBS60.0% improvement ratio 2005 results excludes 1Q06 58.0% may 2007 differ 57.8% allows merger-related Goal from 52 investing -expectations 55% and for restructuring sustainable for
Slide 16: Investing in growth: Westcorp and Golden West
Investing Credit Focused Sustainable Auto –Westcorp Retail Golden Page Lower Not Expected $13 9th 12 Loans largest aFranchise billion Cards West nationwide –marketing for acquisition #4623, to growth originator; in sustainable Financial grow owned Expansion UBS or to and through toclosed WB’s mass m
Slide 17: Golden West: another complementary acquisition
Golden Another Extends Complementary Meets Merger Page 13our integration West –retail combination #4623, financial acquisition and mortgage UBS small isparameters less with business complicated models a best-in-class with distribution produce modest than partner scale typical cost intoand saves high
Slide 18: Strategic rationale and transaction
Strategic Expands –Diversifies Financially Accelerates Accretive IRR Analysis Compelling Low Complementary Strong Straight-forward Assumptions Page Accelerates Solidifies Consumer Reduces of Risk 14credit 17% –high based Rationale to Transaction #4623, normalized Wachovia’s Attractive national retai
Slide 19: Combination strengthens Wachovia's retail franchise
Combination Retail Golden Combined Scaled Broader National Top Business Exclusive Increases Low Improves Growth Proven Ability 12% Accretive Branch Accelerates Page10 risk consensus 15Franchise branch national business to presence West Profile –footprint mortgage Mix $121 General credit integrate to
Slide 20: Combination strengthens earnings mix
Combination WB’s 57% 9% 25% 5% Combined 65% 7% 3% 21% 4% Mortgage-Related Mortgage *Represents income **Based ***Includes PageWealth Capital Parent General Corporate 16 2005 available –on Contributes #4623, Pro Management Segment estimated estimated 2005 strengthens Bank Forma** &to UBS Investment s
Slide 21: Combination creates high growth markets presence
Combination 5.9% High –Creates Wachovia World *whose Source: 1. 2. 3. Page 8.8% #$91K Deposit Includes 6 17 growth pro combined Savings projected average Top SNL parent, –forma #4623, financial Securities Mortgage weighted CA, 5/Financial strengthens bank high Bank Golden rank national NV, household
Slide 22: Combination deepens mortgage platform
Combination WB Wholesale Financial Builders Realtors Retail GDW 2005 Introduce –Deepen *Includes Page Wholesale Predominantly Underwriting Realtors Builders Financial Retail Mortgage 18 production: Mortgage customers and customers –planners Option fixed AmNet #4623, brokers planners enhance brokers
Slide 23: Corporate priorities
Corporate Maintaining Building Executing Improving Focus –Successful Page Westcorp Golden 19 on–customer corporate financial West #4623, Priorities revenue cost integrations employee Financial structure UBS strength loyalty growth priorities engagement and strategies and operating drives corporate s
Slide 24: Appendix
Appendix Page 20 - #4623, UBS WACHOVIA
Slide 25: Conservative transaction assumptions
Conservative Fixed Each EPS First Expense $53 One-time $293 Revenue Deposit None Targeted Tangible: Leverage:** *Based **Tangible Page million Assumptions/Growth Call 21 GDW million included Exchange on Divestitures –Efficiencies Capital Enhancements estimates 4.7% Costs #4623, May common share afte
Slide 26: Excess capital and EPS dilution
–Capital Excess Estimated Market $3.7-4.1B Limited $3.3-3.7B Golden 11.56x Wachovia *11.40x (0.4%) ** (GDW: ***See Page Reduces Limits Ranges Based 22capital premium required West pp. $70.51, cash –cash depend on #4623, 2007 GDW effective 14-15 May 2007 EPS EPS created approximates and $6.10 P/E** c
Slide 27: Cautionary statement
Cautionary This financial expectations current The Merger within difficulties West’s than effects monetary and investment statements Golden Page (iii) capital following expected investor 23the shareholders of, beliefs will West statements –and fluctuations; #4623, and expected can concerning in mana
Slide 28: Additional information
Theaproposed file statement/prospectus important will Copies Investor Wachovia Merger. Information Additional Merger Page also 24 joint of when Information –Relations, bethe information. #4623, and proxy information able about joint itMerger Golden becomes to statement, UBS the proxy obtain One abou
Slide 29: Welcome to Wachovia
X X THE FOLLOWING WAS MADE AVAILABLE TO GOLDEN WEST AND WACHOVIA EMPLOYEES. X Welcome to Wachovia Ben Jenkins, Vice Chairman and Head of the General Bank May 2006
Slide 30: Wachovia Corporation Vision
Wachovia Corporation Vision We will be the best, most trusted and admired company in the financial services industry Page 2
Slide 31: Wachovia Corporation Core Values
Wachovia Corporation Core Values Integrity Respect and Value the Individual Teamwork Service Personal Excellence and Accountability Winning Page 3
Slide 32: Wachovia in Perspective
Wachovia in Perspective* Head Office: Charlotte, N.C. Customers: 13.4 million households and businesses Employees: 97,000 Assets: $542 billion Loans: $260 billion Deposits: $323 billion Corporate Moody’s: Aa3 Debt Ratings: S&P: A+ Market Cap: $95 billion** #5 U.S. *As of Mar. 31, 2006 **As of May 5,
Slide 33: Wachovia in Perspective: Our History
Wachovia in Perspective Our History Wachovia Corporation was formed by the 2001 merger of First Union Corporation and the former Wachovia Corporation. Former Wachovia formed in 1879 in the town of Winston-Salem under the name Wachovia National Bank. Merged with Wachovia Loan and Trust in 1911 to for
Slide 34: Delivering sustainable growth
Delivering sustainable growth 2005 – A year of strong performance Fourth consecutive year of double-digit earnings growth Fifth consecutive year of leading customer service Generated strong customer acquisition and market share gains Invested for the future Superior shareholder returns – #2 sharehol
Slide 35: Wachovia in perspective: Diversified businesses
Wachovia in perspective: Diversified businesses 2005 Segment Earnings Key Business Lines ($ millions) US Rank General Bank $3,904 (60%) (Retail, small business and commercial banking) 3,159 branches, 5,179 ATMs #3 Capital Management $579 (9%) Retail Brokerage: 10,500 registered reps #3* Mutual Fund:
Slide 36: Wachovia in perspective
Wachovia in perspective th 4 largest bank holding company in U.S. rd 3 largest full-service U.S. brokerage firm* 97,000 employees 3,159 financial centers & 5,179 ATMs Wachovia Financial Centers 730 retail brokerage Wachovia Brokerage Offices offices Westcorp Financial Centers Page 8 *Based on client
Slide 37: Wachovia in perspective: Together with Golden West
Wachovia in perspective: Together with Golden West th 4 largest bank holding company in U.S. 110,000 employees 3,442 financial centers & 5,179 ATMs Wachovia Financial Centers Wachovia Brokerage Offices Gold Financial Centers Gold Mortgage Lending Offices States Page 9
Slide 38: Wachovia Strategic Business Priorities
Wachovia Strategic Business Priorities Revenue Growth Successful Merger Customer Integration Loyalty Best, most trusted & most admired financial services Lower company Employee Operating Engagement Cost Corporate Governance Page 10
Slide 39: Employee Engagement
Employee Engagement Valuing Employees Employee Engagement Competitive Compensation 74% 70% Market-based compensation for all job classes 58% 100% of employees eligible for cash incentives 49% Volunteer Opportunities Time Away from Work for Community Service More than 650,000 employee volunteer hours
Slide 40: Employee Engagement
Employee Engagement Sample of benefits: – Comprehensive health care benefits – Matched retirement savings plan – Education reimbursement program – 4 hours paid time/month to volunteer Wachovia is recognized for developing an inclusive workplace that values employees: rd – One of Working Mother magaz
Slide 41: Customer Loyalty
Customer Loyalty Customer Satisfaction Percentage Loyal Scores* Customers* 6.59 6.63 6.57 55.0% 6.49 51.1% 6.35 48.6% 45.3% 20% 40.2% 5.59 11% 1Q99 4Q01 4Q02 4Q03 4Q04 4Q05 4Q02 4Q03 4Q04 4Q05 2006 Goal *Data is from independent studies conducted with customers who transact *Data is from independent
Slide 42: Customer Loyalty
Customer Loyalty th #1 for 5 consecutive year #1 among large banks 2005 American Customer J.D. Power and Associates Satisfaction Index* 2006 Retail Banking Satisfaction sm† Score Study 2005 vs. 2001 USAA Federal Savings Banks 824 Wachovia 79 +10% (#1) Commerce Bancorp 808 Downey Savings & Loan 797 A
Slide 43: Customer Loyalty: The Wachovia Service Philosophy
Customer Loyalty: The Wachovia Service Philosophy I will warmly welcome you. I will focus only on you. I will make it easy to do business with me. I will take ownership of your needs. I will be knowledgeable and professional. I will be responsive to your questions and requests. I appreciate your bus
Slide 44: Revenue Growth: Investing in the business drives future growth
Revenue Growth: Investing in the business drives future growth Reinvesting 30-50% of efficiencies for future revenue growth 2006 Growth Initiatives Credit Cards – Focused marketing to WB’s 11 million retail and small business households Mortgage – Expand modest market share – Hire 500-700 mortgage b
Slide 45: Corporate Governance Leadership
Corporate Governance Leadership 1999 2006 Board Size 26 16 Lead Independent Director No Yes Board meets independently from No Yes management All directors have meaningful Wachovia No Yes stock holdings All stock plans approved by shareholders No Yes Stock options expensed No Yes Senior management re
Slide 46: Lower Operating Costs: Improving Overhead Efficiency
Lower Operating Costs: Improving Overhead Efficiency* 64.3% 64.7% 60.6% 60.0% 59.1% 57.2% 56.2% 52 - 55% 2000 2001 2002 2003 2004 1Q05 2Q05 2007 Goal *Overhead efficiency ratio excludes merger-related and restructuring charges, changes in accounting principle and intangible amortization. 2007 not a
Slide 47: Successful Merger Integration
Successful Merger Integration Track record of successful integrations: – First Union/Wachovia – 2003 – SouthTrust – 2005 Our Philosophy: – Goal = no customer attrition – Thoughtful, deliberate approach – Retain all frontline, customer-facing employees – Carefully plan merger transitions and conversi
Slide 48: General Bank Overview
General Bank Overview General Bank $13B Revenue 11MM Household & Business Relationships $178B Loans 45,400 Employees $216B Deposits Retail & Small Business Wholesale Businesses $9B Revenue $3.8B Revenue $89B Loans $89B Loans $47B Deposits $170B Deposits 75,000 Wholesale Relationships $26B Mortgage P
Slide 49: General Bank Focus Areas
General Bank Focus Areas Sales focus with industry-leading service levels Service Drive new customer acquisition and customer retention Delivery Relentless pursuit of customer loyalty (2005 goal of 52%) Communication, measurement, incentives and coaching Sales Continued focus on increasing branch pr
Slide 50: Sustainable growth drives material stock outperformance
Sustainable growth drives material stock outperformance 5 year Total Return WB +123% (# 2 of Top 20 U.S. Banks) 140% 120% 100% 80% 60% BKX +33% 40% 20% 0% -20% S&P 500 +3% -40% 4Q01 4Q02 4Q03 4Q04 4Q05 Wachovia’s 5 year total return performance of 123% is more than 3.5 times that of the BKX and 41 t
Slide 51: Marketplace Accolades
Marketplace Accolades Top 100 Companies for Working Mothers Top 100 Best Corporate Citizens Outstanding CRA rating Top 20 Best Corporate Reputation Outstanding Corporation for Philanthropic Efforts Page 23
Slide 52: Cautionary statement
Cautionary statement This investor presentation contains certain forward-looking statements, including, without limitation, (i) statements relating to the benefits of the proposed merger between Wachovia and Golden West (the “Merger”), including future financial and operating results, cost savings,
Slide 53: Additional information
Additional information The proposed Merger will be submitted to Wachovia’s and Golden West’s shareholders for their consideration. Wachovia will file a registration statement, which will include a joint proxy statement/prospectus, and Golden West will file a joint proxy statement, and each of Wachov
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Golden West Financial — Merger or Acquisition (May 2006) on 6ix