SunTrust 2011 Annual Report Download - page 209
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Please find page 209 of the 2011 SunTrust annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Notes to Consolidated Financial Statements (Continued)
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United States and States Attorneys General Mortgage Servicing Claims
In January, 2012, the Company commenced discussions related to a mortgage servicing settlement with the U.S., through the
Department of Justice, and Attorneys General for several states regarding various potential claims relating to the Company's
mortgage servicing activities. While these discussions are in the preliminary stages and the Company has not reached any agreement
with such parties, the Company estimates that the cost of resolving these and potential similar claims, including the costs of such
a settlement, borrower-specific actions, and/or legal matters to defend such claims if they are not settled, will be approximately
$120 million, pre-tax, ($81 million, after-tax), and the Company has accrued this expense in the 2011 financial results of the
Company. Notwithstanding the fact that the Company did not enter into material discussions until 2012, applicable accounting
standards required that this estimate be reflected in the Company's financial results as of, and for the year ended, December 31,
2011 because the facts underlying such claims existed as of December 31, 2011. See Note 25, "Subsequent Event," for additional
discussion.
NOTE 21 - BUSINESS SEGMENT REPORTING
The Company has six business segments used to measure business activities: Retail Banking, Diversified Commercial Banking,
CRE, CIB, Mortgage, and W&IM with the remainder in Corporate Other and Treasury. The business segments are determined
based on the products and services provided, or the type of customer served, and they reflect the manner in which financial
information is currently evaluated by management.
Retail Banking serves consumers and business clients with less than $5 million in annual revenue (up to $10 million in sales in
larger metropolitan markets). Retail Banking provides services to clients through an extensive network of traditional and in-store
branches, ATMs, the internet (www.suntrust.com), and the telephone (1-800-SUNTRUST). Financial products and services offered
to consumers include consumer deposits, home equity lines, consumer lines, indirect auto, student lending, bank card, and other
consumer loan and fee-based products. Retail Banking also serves as an entry point and provides services for other lines of business.
When client needs change and expand, Retail Banking refers clients to our W&IM, CIB, Mortgage, Diversified Commercial
Banking, CRE, and Corporate Other and Treasury lines of business.
Diversified Commercial Banking provides enterprises with a full array of financial products and services including commercial
lending, financial risk management, capital raising, commercial card, and other treasury and payment solutions. The primary
client segments served by this line of business include Commercial ($5 million to $100 million in annual revenue), Middle Market
($100 million to $750 million in annual revenue), Dealer Services (financing dealer floor plan inventories) and Not-for-Profit and
Government entities. Diversified Commercial Banking also includes the Premium Assignment Corporation, which provides
insurance premium financing, and Leasing, which provides equipment and lease financing; both provide services inside and outside
of the SunTrust footprint.
CRE offers a broad range of financial solutions to commercial real estate developers and investors. Services include construction,
mini-perm, and permanent real estate financing, capital raising services, financial risk management, treasury and payment solutions,
investment advisory and management services, as well as tailored financing and equity investment solutions for community
development and affordable housing projects delivered through SunTrust Community Capital.
CIB offers a full line of traditional banking and investment banking services to corporate banking and institutional investor clients.
The Corporate Banking Group generally serves clients with greater than $750 million in annual revenue and is focused on selected
industry sectors: consumer and retail, energy, financial services and technology, healthcare, and media and communications.
Through STRH, CIB provides an extensive range of investment banking products and services to its clients, including strategic
advice, capital raising, and financial risk management. These investment banking products and services are also provided to
Middle Market, Diversified Commercial Banking and W&IM clients. CIB also offers traditional lending, leasing, treasury
management services and institutional investment management to its clients.
The Mortgage line of business offers residential mortgage products nationally through its retail, broker and correspondent channels,
as well as via the internet (www.suntrust.com) and by the telephone (1-800-SUNTRUST). These products are either sold in the
secondary market, primarily with servicing rights retained, or held in the Company's loan portfolio. The line of business services
loans for itself, for other SunTrust lines of business, and for other investors. The line of business also includes ValuTree Real
Estate Services, LLC, a tax service subsidiary.
W&IM provides a full array of wealth management products and professional services to both individual and institutional clients.
W&IM's primary businesses include PWM, GenSpring, IIS, and RidgeWorth.