Fifth Third Bank 2009 Annual Report Download - page 15

2009 ANNUAL REPORT
FINANCIAL CONTENTS
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Selected Financial Data 14
Overview 15
Non-GAAP Financial Measures 17
Critical Accounting Policies 18
Risk Factors 21
Statements of Income Analysis 26
Business Segment Review 32
Fourth Quarter Review 37
Balance Sheet Analysis 39
Risk Management 43
Off-Balance Sheet Arrangements 60
Contractual Obligations and Other Commitments 61
Management’s Assessment as to the Effectiveness of Internal Control over Financial Reporting 62
Reports of Independent Registered Public Accounting Firm 63
Financial Statements
Consolidated Balance Sheets 64
Consolidated Statements of Income 65
Consolidated Statements of Changes in Shareholders’ Equity 66
Consolidated Statements of Cash Flows
67
Notes to Consolidated Financial Statements
Summary of Significant Accounting and Reporting Policies 68 Commitments, Contingent Liabilities and Guarantees 90
Supplemental Cash Flow Information 74 Legal and Regulatory Proceedings 93
Business Combinations and Asset Acquisitions 74 Processing Business Sale 93
Restrictions on Cash and Dividends 75 Related Party Transactions 93
Securities 75 Income Taxes 94
Loans and Leases and Allowance for Loan and Lease Losses 77 Retirement and Benefit Plans 96
Loans with Deteriorated Credit Quality Acquired in a Transfer 78
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ccumulated Other Comprehensive Income 98
Bank Premises and Equipment 79 Common, Preferred and Treasury Stock 99
Goodwill 79 Stock-Based Compensation 100
Intangible Assets 80 Other Noninterest Income and Other Noninterest Expense 102
Sales of Receivables and Servicing Rights 80 Earnings Per Share 103
Derivatives 83 Fair Value Measurements 104
Other Assets 87 Certain Regulatory Requirements and Capital Ratios 109
Short-Term Borrowings 88 Parent Company Financial Statements 110
Long-Term Debt 89 Segments 111
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nnual Report on Form 10-K 114
Consolidated Ten Year Comparison 129
Directors and Officers 130
Corporate Information
FORWARD-LOOKING STATEMENTS
This report may contain forward-looking statements about Fifth Third Bancorp and/or the company as combined acquired entities within the meaning of Section 27A of the Securities Act of
1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder, that involve inherent
risks and uncertainties. This report may contain certain forward-looking statements with respect to the financial condition, results of operations, plans, objectives, future performance and
business of Fifth Third Bancorp and/or the combined company including statements preceded by, followed by or that include the words or phrases such as “will likely result,” “may,” “are
expected to,” “is anticipated,” “estimate,” “forecast,” “projected,” “intends to,” or may include other similar words or phrases such as “believes,” “plans,” “trend,” “objective,” “continue,”
“remain,” or similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” or similar verbs. There are a number of important factors that could
cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) general
economic conditions and weakening in the economy, specifically the real estate market, either nationally or in the states in which Fifth Third, one or more acquired entities and/or the combined
company do business, are less favorable than expected; (2) deteriorating credit quality; (3) political developments, wars or other hostilities may disrupt or increase volatility in securities markets or
other economic conditions; (4) changes in the interest rate environment reduce interest margins; (5) prepayment speeds, loan origination and sale volumes, charge-offs and loan loss provisions;
(6) Fifth Third’s ability to maintain required capital levels and adequate sources of funding and liquidity; (7) maintaining capital requirements may limit Fifth Third’s operations and potential
growth; (8) changes and trends in capital markets; (9) problems encountered by larger or similar financial institutions may adversely affect the banking industry and/or Fifth Third
(10) competitive pressures among depository institutions increase significantly; (11) effects of critical accounting policies and judgments; (12) changes in accounting policies or procedures as may
be required by the Financial Accounting Standards Board (FASB) or other regulatory agencies; (13) legislative or regulatory changes or actions, or significant litigation, adversely affect Fifth
Third, one or more acquired entities and/or the combined company or the businesses in which Fifth Third, one or more acquired entities and/or the combined company are engaged; (14) ability
to maintain favorable ratings from rating agencies; (15) fluctuation of Fifth Third’s stock price; (16) ability to attract and retain key personnel; (17) ability to receive dividends from its
subsidiaries; (18) potentially dilutive effect of future acquisitions on current shareholders’ ownership of Fifth Third; (19) effects of accounting or financial results of one or more acquired entities;
(20) difficulties in separating Fifth Third Processing Solutions from Fifth Third; (21) loss of income from any sale or potential sale of businesses that could have an adverse effect on Fifth
Third’s earnings and future growth; (22) ability to secure confidential information through the use of computer systems and telecommunications networks; and (23) the impact of reputational
risk created by these developments on such matters as business generation and retention, funding and liquidity.