Edgar Filing: WACHOVIA CORP NEW

Wachovia Corporation

Filed Pursuant to Rule 433

Registration No. 333-150225

LOGO


		Press Release April 14, 2008

WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES INITIATIVES

TO FURTHER ENHANCE CAPITAL BASE AND FLEXIBILITY

— Plans to Raise Capital through Public Offering

— Reduces Quarterly Dividend to $0.375 Per Common Share, Preserving $2.0 Billion of

Capital Annually

— Increases Credit Reserves; Provision $2.1 Billion Above Net Charge-offs

— Net Loss of $350 Million or $393 Million (20 Cents) after Preferred Dividend

— Strong Sales Momentum and Solid Underlying Expense Control Cushions Impact of

Rising Credit Costs and Market Disruption Losses

CHARLOTTE, N.C. – Wachovia today announced a series of actions to further enhance its capital base and operational flexibility, and updated its credit reserve modeling to reflect greater emphasis on forecasted changes in customer behavior assuming continued house price depreciation. These actions include:

•

Plans to raise capital through a public offering of common stock and perpetual convertible preferred stock;

•

Lowering the quarterly common stock dividend, which preserves $2.0 billion of capital annually, to build capital ratios and provide more operational flexibility. The board of directors declared a quarterly common stock dividend of $0.375 cents per common share, payable on June 16, 2008, to stockholders of record on May 30, 2008. This dividend level is consistent with Wachovia’s capital needs and growth opportunities for each of its business segments, and with an anticipated 40 percent to 50 percent cash payout ratio over the intermediate horizon; and

•

The update in the credit reserve modeling in response to the current and forecasted market environment and its effect on consumer behavior, particularly in stressed markets, resulting in a significant increase in the first quarter 2008 provision for credit losses. In addition, the scope of credit disclosures was increased to provide enhanced insight into the payment option consumer real estate portfolio.

In addition, Wachovia reported a first quarter 2008 net loss of $350 million before preferred dividends, or a net loss available to common stockholders of $393 million, (20 cents per common share). These results, which reflect higher credit costs and the continued disruption in the capital markets, compared with earnings of $2.30 billion, or $1.20 per share, in the first quarter of 2007.

While solid underlying performance was overshadowed by market disruption-related valuation losses of $2.0 billion, Wachovia generated total revenue of $7.9 billion on higher loans and deposits and strength in fiduciary and asset management fees, brokerage commissions and traditional banking fees, including the impact of the A.G. Edwards acquisition.

“I’m deeply disappointed with our first quarter results, but I am confident we’re taking prudent and appropriate actions in this challenging period to restore Wachovia to a more profitable path. The precipitous decline in housing market conditions and unprecedented changes in consumer behavior prompted us to update our credit reserve modeling and rely less heavily on historical trends to forecast losses. As a result, we have substantially increased our reserves,” said Ken Thompson, Wachovia’s chief executive officer. “The most painful decision was to reduce the dividend because it adversely affects our shareholders. But we believe the long-term benefit to

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 2

shareholder value outweighs the disadvantage of the dividend reduction as we fortify our balance sheet against continued instability in the housing and capital markets.

“It’s important to note that in early 2007 in advance of the market dislocation, we took steps to bolster our liquidity and reduce market-related exposures in products originally intended for distribution,” Thompson added. “We have generally been a provider of liquidity to the market during this period of market disruption, and we also continue to reduce our market-related exposures. The actions we announced today will further enhance and ensure our ongoing financial flexibility to invest and drive future earnings growth. With strengthened reserves and capital, and our strong deposit base, we believe we’re well-positioned to continue to successfully weather this uniquely challenging period.”

Earnings Highlights


	Three Months Ended
	March 31, 2008					December 31, 2007				March 31, 2007
(In millions, except per share data)	Amount			EPS		Amount		EPS		Amount	EPS
Earnings
Net income (loss)	$	(350	)	—		193		0.10		2,302	1.20
Discontinued operations, net of income taxes		—		—		(142	)	(0.07	)	—	—
Dividends on preferred stock		(43	)	—		—		—		—	—

Net income (loss) available to common stockholders	$	(393	)	(0.20	)	51		0.03		2,302	1.20
Discontinued operations, net of income taxes		—		—		142		0.07		—	—

Income (loss) from continuing operations		(393	)	(0.20	)	193		0.10		2,302	1.20
Net merger-related and restructuring expenses		123		0.06		108		0.05		6	—

Earnings (loss) excluding merger-related and restructuring expenses, and discontinued operations	$	(270	)	(0.14	)	301		0.15		2,308	1.20

Financial ratios
Return on average common stockholders’ equity		(2.11	)%			0.28				13.47
Net interest margin (a)		2.92				2.88				3.06
Fee and other income as % of total revenue (a)		39.15				36.99				45.15
Overhead efficiency ratio (a)		68.91	%			78.00				55.88

Capital adequacy (b)
Tier 1 capital ratio		7.5	%			7.4				7.4
Total capital ratio		12.1				11.8				11.4
Leverage ratio		6.2	%			6.1				6.1

Asset quality
Allowance for loan losses as % of nonaccrual and restructured loans		84	%			90				207
Allowance for loan losses as % of loans, net		1.37				0.98				0.80
Allowance for credit losses as % of loans, net (c)		1.41				1.02				0.84
Net charge-offs as % of average loans, net		0.66				0.41				0.15
Nonperforming assets as % of loans, net, foreclosed properties and loans held for sale		1.70	%			1.14				0.42

(a)	Tax-equivalent.

(b)	The first quarter of 2008 is based on estimates.

(c)	The allowance for credit losses is the sum of the allowance for loan losses and the reserve for unfunded lending commitments.

Results include after-tax net merger-related expenses of 6 cents per share in the first quarter of 2008; these expenses did not affect earnings per share in the first quarter of 2007. Excluding the merger-related expenses, results were a net loss available to common stockholders of $270 million, or 14 cents per share, in the first quarter of 2008. Results also include the impact of the A.G. Edwards, Inc., acquisition from October 1, 2007.

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 3

Wachovia Corporation


	Three Months Ended
(In millions)	March 31, 2008			December 31, 2007		March 31, 2007
Net interest income (Tax-equivalent)	$	4,805		4,674		4,537
Fee and other income		3,091		2,744		3,734
Total revenue (Tax-equivalent)		7,896		7,418		8,271
Provision for credit losses		2,831		1,497		177
Noninterest expense		5,441		5,786		4,621
Income (loss) from continuing operations before income taxes (benefits) (Tax-equivalent)		(531	)	28		3,337
Income taxes (benefits) (Tax-equivalent)		(181	)	(165	)	1,035
Net income (loss) available to common stockholders		(393	)	51		2,302
Average loans, net		465,936		449,805		415,261
Average core deposits	$	394,513		390,043		369,270

Other key trends in the first quarter of 2008 compared with the first quarter of 2007 included:

•

Revenue of $7.9 billion on higher loan and deposit balances, while fee and other income declined due to net market disruption-related valuation losses of $2.0 billion and significantly reduced fee income related to the disruption in the capital markets. Otherwise, strong momentum continued in fiduciary and asset management fees and brokerage commissions reflecting the A.G. Edwards acquisition and organic growth. Results included $445 million in net gains related to adoption of new fair value accounting standards and a $225 million gain related to the Visa initial public offering.

•

Net interest margin compression of 14 basis points year over year, although the margin rose 4 basis points from the fourth quarter of 2007. Net interest income rose modestly, reflecting growth in average commercial loans, up 26 percent, and average consumer loans, up 4 percent, as well as solid core deposit growth, up 7 percent. Average loan growth included the impact of $7.3 billion of transfers to the loan portfolio from held-for-sale as well as strength in commercial, commercial real estate and traditional conforming mortgage loans. Deposit growth was led by strength in IRAs and money market accounts.

•

An 18 percent increase in noninterest expense largely reflecting the impact of A.G. Edwards, as well as growth in credit-related sundry expense.

•

Provision for credit losses of $2.8 billion, which exceeded net charge-offs by $2.1 billion. The provision largely reflected more severe deterioration in the residential housing market, particularly in specific markets in California and Florida, as well as the result of the refinements made to the credit reserve model for the payment option product. These refinements incorporate multiple and more granular factors regarding unprecedented consumer behavior, housing price deterioration and increased foreclosures. Net charge-offs were $765 million, or an annualized 0.66 percent of average net loans. Total nonperforming assets including loans held for sale were $8.4 billion, or 1.70 percent of loans, foreclosed properties and loans held for sale, largely reflecting increases in consumer real estate-related nonperforming assets due to the effects of the weakened housing industry.

Lines of Business

The following discussion covers the results for Wachovia’s four core business segments and is on a segment earnings basis, which excludes net merger-related and restructuring expenses, other intangible amortization and discontinued operations. Segment earnings are the basis on which

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 4

Wachovia manages and allocates capital to its business segments. In accordance with Wachovia’s business segment methodology, provision expense in excess of charge-offs, which amounted to $2.1 billion in the first quarter of 2008, is not allocated to business segments.

Pages 13 and 14 include a reconciliation of segment results to Wachovia’s consolidated results of operations in accordance with GAAP.

General Bank Highlights


	Three Months Ended
(In millions)	March 31, 2008			December 31, 2007	March 31, 2007
Net interest income (Tax-equivalent)	$	3,455		3,402	3,398
Fee and other income		990		929	845
Total revenue (Tax-equivalent)		4,500		4,389	4,290
Provision for credit losses		569		320	147
Noninterest expense		2,050		2,041	1,869
Segment earnings	$	1,195		1,287	1,444
Cash overhead efficiency ratio (Tax-equivalent)		45.55	%	46.50	43.56
Average loans, net	$	311,447		303,269	288,229
Average core deposits		297,680		296,568	284,046
Economic capital, average	$	12,695		11,179	10,662

General Bank

The General Bank includes retail, small business and commercial customers. The first quarter of 2008 compared with the first quarter of 2007 included:

•

Earnings of $1.2 billion, down $249 million, driven by rapidly rising credit costs and related expenses, which overshadowed continued strong sales momentum reflected in total revenue of $4.5 billion, up 5 percent.

•

Average loan growth of 8 percent, with double digit growth in wholesale businesses and 4 percent growth in mortgage lending as a decline in prepayments offset lower volumes on the payment option mortgage product.

•

Significant efforts in the mortgage business included a restructuring of the operating model, extensive loss mitigation efforts and initiatives to increase the volume of marketable mortgages.

•

A home equity lending decline of 41 percent, reflecting implementation of tightened credit standards. Over 95 percent of our home equity loans are originated through our branch network and other direct channels.

•

A 26 percent increase in auto loan originations

•

Average core deposit growth of 5 percent, largely reflecting strength in wholesale deposits, which were up 10 percent, and an increase of 4 percent in retail deposits.

•

Growth in net new retail checking accounts slowed to a still strong increase of 174,000 in the first quarter of 2008 compared with an increase of 268,000 in the first quarter of 2007.

•

Net new checking accounts include 139,000 linked to the new Way2Save accounts, which launched in mid-January 2008.

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 5

•

17 percent growth in fee and other income, with strength in service charges, interchange income and mortgage banking fee income. Strong interchange income reflected an 18 percent increase in debit/credit card volume from the first quarter of 2007.

•

Noninterest expense up 10 percent due to growth in credit-related sundry expense, as well as on continued strategic investment in de novo branch activity, Western expansion and buildup in credit card operations. During the first quarter of 2008, 23 de novo branches were opened and 58 branches were consolidated. As a result of performance initiatives, operating leverage continued to improve, which enabled the continued strategic investment.

•

A $422 million increase in the provision for credit losses largely reflecting rapid deterioration in consumer real estate in certain housing markets and higher losses on auto loans.

Wealth Management Highlights


	Three Months Ended
(In millions)	March 31, 2008			December 31, 2007	March 31, 2007
Net interest income (Tax-equivalent)	$	181		183	181
Fee and other income		211		214	196
Total revenue (Tax-equivalent)		397		400	380
Provision for credit losses		5		7	1
Noninterest expense		246		249	247
Segment earnings	$	92		91	84
Cash overhead efficiency ratio (Tax-equivalent)		62.08	%	62.27	65.12
Average loans, net	$	22,413		21,791	20,394
Average core deposits		17,397		16,773	17,267
Economic capital, average	$	705		616	592

Wealth Management

Wealth Management includes private banking, personal trust, investment advisory services, charitable services, financial planning and insurance brokerage. The first quarter of 2008 compared with the first quarter of 2007 included:

•

Earnings of $92 million on 4 percent revenue growth in challenging markets.

•

Strong fiduciary and asset management fees as a pricing initiative implemented in the third quarter of 2007 and new sales offset declines in equity valuations. Insurance commissions declined largely due to a soft market for insurance premiums and nonstrategic insurance account dispositions.

•

Relatively flat net interest income as solid loan growth offset deposit spread compression.

•

A slight decline in expense driven by efficiency initiatives, which offset the impact of private banking and Western expansion investment.

•

5 percent growth in assets under management to $79.8 billion as asset gathering overcame market depreciation.

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 6

Corporate and Investment Bank Highlights


	Three Months Ended
(In millions)	March 31, 2008			December 31, 2007		March 31, 2007
Net interest income (Tax-equivalent)	$	1,032		988		716
Fee and other income		(159	)	(555	)	1,109
Total revenue (Tax-equivalent)		823		383		1,782
Provision for credit losses		197		112		6
Noninterest expense		747		952		911
Segment earnings (loss)	$	(77	)	(431	)	550
Cash overhead efficiency ratio (Tax-equivalent)		90.76	%	247.83		51.10
Average loans, net	$	101,024		91,702		73,385
Average core deposits		33,623		36,200		34,227
Economic capital, average	$	13,242		11,293		8,329

Corporate and Investment Bank

The Corporate and Investment Bank includes corporate lending, investment banking, and treasury and international trade finance. First quarter 2008 results compared with the first quarter of 2007 included:

•

A segment loss of $77 million driven by $1.6 billion in net valuation losses reflecting continued disruption in the capital markets and reduced origination volume in most market-related businesses.

•

Market valuation losses, net of applicable hedges, of:

•

$339 million in subprime residential asset-backed collateralized debt obligations and other related exposures, compared with $818 million in fourth quarter 2007, excluding discontinued operations;

•

$521 million in commercial mortgage structured products, compared with $600 million in fourth quarter 2007;

•

$251 million in consumer mortgage structured products, compared with $123 million in fourth quarter 2007;

•

$309 million in leveraged finance net of fees, compared with a net $93 million gain in fourth quarter 2007; and

•

$144 million in non-subprime collateralized debt obligations and other structured products, compared with a $59 million net gain in fourth quarter 2007.

•

A 44 percent increase in net interest income, which reflected 38 percent growth in average loans including the transfer into the loan portfolio at fair value of certain loans originally slated for disposition, as well as loan growth in the corporate lending and global financial institutions business.

•

Principal investing revenue of $414 million, largely due to a net $486 million of gains related to the adoption of new fair value accounting standards in January 2008, offset by mark-to-market losses in the direct investment portfolio.

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 7

•

An 18 percent decline in noninterest expense primarily due to lower variable compensation and reduced headcount in investment banking.

•

Provision of $197 million largely reflecting residential-related commercial real estate losses.

Capital Management Highlights


	Three Months Ended
(In millions)	March 31, 2008			December 31, 2007	March 31, 2007
Net interest income (Tax-equivalent)	$	274		318	259
Fee and other income		2,191		2,211	1,477
Total revenue (Tax-equivalent)		2,455		2,518	1,728
Provision for credit losses		—		—	—
Noninterest expense		1,855		1,938	1,237
Segment earnings	$	381		368	312
Cash overhead efficiency ratio (Tax-equivalent)		75.54	%	76.96	71.59
Average loans, net	$	2,562		2,295	1,554
Average core deposits		43,084		38,019	31,683
Economic capital, average	$	2,143		2,120	1,334

Capital Management

Capital Management includes retail brokerage services and asset management. The first quarter of 2008 compared with the first quarter of 2007 included:

•

Earnings of $381 million on 42 percent revenue growth, which primarily reflected the A.G. Edwards acquisition. In addition, solid growth in retail brokerage managed account and other asset-based fees despite declining equity markets offset lower transactional revenue and equity syndicate distribution fees. The impact of FDIC sweep deposit growth of $11.0 billion partially offset spread compression in the declining interest rate environment.

•

Record annuity sales of $2.7 billion, including $1.5 billion in the General Bank financial centers.

•

50 percent growth in noninterest expense largely due to the effect of A.G. Edwards, as well as higher legal expense and revenue-based commissions.

Total assets under management of $258.7 billion at March 31, 2008, decreased 6 percent from December 31, 2007, primarily due to declining market valuations.

***

Wachovia Corporation (NYSE:WB) is one of the nation’s largest diversified financial services companies, with assets of $808.9 billion and market capitalization of $53.8 billion at March 31, 2008. Wachovia provides a broad range of retail banking and brokerage, asset and wealth management, and corporate and investment banking products and services to customers through 3,300 retail financial centers in 21 states from Connecticut to Florida and west to Texas and California, and nationwide retail brokerage, mortgage lending and auto finance businesses. Globally, clients are served in selected corporate and institutional sectors and through more than 40 international offices. Our retail brokerage operations under the Wachovia Securities brand name manage more than $1.1 trillion in client assets through 18,600 registered representatives in 1,500 offices nationwide. Online banking is available at wachovia.com; online brokerage products and services at wachoviasec.com; and investment products and services at evergreeninvestments.com.

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WACHOVIA REPORTS 1ST QUARTER RESULTS; ANNOUNCES CAPITAL INITIATIVES/page 8

Forward-Looking Statements

This news release contains various forward-looking statements. A discussion of various factors that could cause Wachovia Corporation’s actual results to differ materially from those expressed in such forward-looking statements is included in Wachovia’s filings with the Securities and Exchange Commission, including its Current Report on Form 8-K dated April 14, 2008.

Explanation of Wachovia’s Use of Certain Non-GAAP Financial Measures

In addition to results presented in accordance with GAAP, this news release includes certain non-GAAP financial measures, including those presented on page 2 and on page 11 under the captions “Earnings Excluding Merger-Related and Restructuring Expenses, and Discontinued Operations” and “Earnings Excluding Merger-Related and Restructuring Expenses, Other Intangible Amortization and Discontinued Operations”, and which are reconciled to GAAP financial measures on pages 21 and 22. In addition, in this news release certain designated net interest income amounts are presented on a tax-equivalent basis, including the calculation of the overhead efficiency ratio.

Wachovia believes these non-GAAP financial measures provide information useful to investors in understanding the underlying operational performance of the company, its business and performance trends and facilitates comparisons with the performance of others in the financial services industry. Specifically, Wachovia believes the exclusion of merger-related and restructuring expenses, discontinued operations and the cumulative effect of a change in accounting principle permits evaluation and a comparison of results for on-going business operations, and it is on this basis that Wachovia’s management internally assesses the company’s performance. Those non-operating items are excluded from Wachovia’s segment measures used internally to evaluate segment performance in accordance with GAAP because management does not consider them particularly relevant or useful in evaluating the operating performance of our business segments. In addition, because of the significant amount of deposit base intangible amortization, Wachovia believes the exclusion of this expense provides investors with consistent and meaningful comparisons to other financial services firms. Wachovia’s management makes recommendations to its board of directors about dividend payments based on reported earnings excluding merger-related and restructuring expenses, other intangible amortization, discontinued operations and the cumulative effect of a change in accounting principle, and has communicated certain dividend payout ratio goals to investors on this basis. Management believes this payout ratio is useful to investors because it provides investors with a better understanding of and permits investors to monitor Wachovia’s dividend payout policy. Wachovia also believes the presentation of net interest income on a tax-equivalent basis ensures comparability of net interest income arising from both taxable and tax-exempt sources and is consistent with industry standards. Wachovia operates one of the largest retail brokerage businesses in our industry, and we have presented an overhead efficiency ratio excluding these brokerage services, which management believes is useful to investors in comparing the performance of our banking business with other banking companies.

Although Wachovia believes the above non-GAAP financial measures enhance investors’ understanding of its business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP basis financial measures.

Earnings Conference Call and Supplemental Materials

Wachovia CEO Ken Thompson and CFO Tom Wurtz will review Wachovia’s first quarter 2008 results in a conference call and audio web cast beginning at 8:00 a.m. Eastern Daylight Saving Time today. This review may include a discussion of certain non-GAAP financial measures. Supplemental materials relating to first quarter results, which also include a reconciliation of any non-GAAP measures to Wachovia’s reported financials, are available on the Internet at Wachovia.com/investor, and investors are encouraged to access these materials in advance of the conference call.

Web cast Instructions: To gain access to the web cast, which will be “listen-only,” go to Wachovia.com/investor and click on the link “Wachovia First Quarter Earnings Audio Web cast.” In order to listen to the web cast, you will need to download either Real Player or Media Player.

Teleconference Instructions: The telephone number for the conference call is 888-357-9787 for U.S. callers or 706-679-7342 for international callers. You will be asked to tell the answering coordinator your name and the name of your firm. Mention the conference Access Code: WB Investor.

Replay: Monday, April 14, by 12:00 Noon EST and continuing through 5 p.m. EST Friday, July 11. Replay telephone number is 706-645-9291; access code: 43662109.

Investors seeking further information should contact the Investor Relations team: Alice Lehman at 704-374-4139 or Ellen Taylor at 704-383-1381. Media seeking further information should contact the Corporate Media Relations team: Mary Eshet at 704-383-7777 or Christy Phillips at 704-383-8178.

Wachovia may file a registration statement (including prospectus) with the SEC for the offering to which this communication relates. Investors should read the prospectus in that registration statement, the preliminary prospectus supplement and other documents that Wachovia has filed with the SEC for more complete information about Wachovia and this offering. Documents may be obtained for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, investors may call toll-free 1-800-326-5897 to request that the prospectus be mailed after filing.

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PAGE 9

WACHOVIA CORPORATION AND SUBSIDIARIES

FINANCIAL TABLES

TABLE OF CONTENTS


		PAGE
Financial Highlights—Five Quarters Ended March 31, 2008		10
Other Financial Data—Five Quarters Ended March 31, 2008		11
Consolidated Statements of Income—Five Quarters Ended March 31, 2008		12
Business Segments—Three Months Ended March 31, 2008 and December 31, 2007		13
Business Segments—Three Months Ended March 31, 2007		14
Loans—On-Balance Sheet, and Managed and Servicing Portfolios—Five Quarters Ended March 31, 2008		15
Allowance for Credit Losses—Five Quarters Ended March 31, 2008		16
Nonperforming Assets—Five Quarters Ended March 31, 2008		17
Consolidated Balance Sheets—Five Quarters Ended March 31, 2008		18
Net Interest Income Summaries—Five Quarters Ended March 31, 2008		19 - 20
Reconciliation of Certain Non-GAAP Financial Measures—Five Quarters Ended March 31, 2008		21 - 22

PAGE 10

WACHOVIA CORPORATION AND SUBSIDIARIES

FINANCIAL HIGHLIGHTS

(Unaudited)


	2008			2007
(Dollars in millions, except per share data)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter
EARNINGS SUMMARY
Net interest income (GAAP)	$	4,752		4,630		4,551		4,449	4,500
Tax-equivalent adjustment		53		44		33		38	37

Net interest income (Tax-equivalent)		4,805		4,674		4,584		4,487	4,537
Fee and other income		3,091		2,744		2,933		4,240	3,734

Total revenue (Tax-equivalent)		7,896		7,418		7,517		8,727	8,271
Provision for credit losses		2,831		1,497		408		179	177
Other noninterest expense		5,097		5,488		4,397		4,755	4,493
Merger-related and restructuring expenses		241		187		36		32	10
Other intangible amortization		103		111		92		103	118

Total noninterest expense		5,441		5,786		4,525		4,890	4,621
Minority interest in income of consolidated subsidiaries		155		107		189		139	136

Income (loss) from continuing operations before income taxes (benefits) (Tax-equivalent)		(531	)	28		2,395		3,519	3,337
Income taxes (benefits)		(234	)	(209	)	656		1,140	998
Tax-equivalent adjustment		53		44		33		38	37

Income (loss) from continuing operations		(350	)	193		1,706		2,341	2,302
Discontinued operations, net of income taxes		—		(142	)	(88	)	—	—

Net income (loss)		(350	)	51		1,618		2,341	2,302
Dividends on preferred stock		43		—		—		—	—

Net income (loss) available to common stockholders	$	(393	)	51		1,618		2,341	2,302

Diluted earnings per common share (a)	$	(0.20	)	0.03		0.85		1.22	1.20
Return on average common stockholders’ equity		(2.11	)%	0.28		9.19		13.54	13.47
Return on average assets		(0.18	)	0.03		0.88		1.33	1.35
Overhead efficiency ratio		68.91	%	78.00		60.20		56.02	55.88
Operating leverage	$	823		(1,359	)	(847	)	189	(13	)

ASSET QUALITY
Allowance for loan losses as % of loans, net		1.37	%	0.98		0.78		0.79	0.80
Allowance for loan losses as % of nonperforming assets		78		84		115		157	189
Allowance for credit losses as % of loans, net		1.41		1.02		0.82		0.83	0.84
Net charge-offs as % of average loans, net		0.66		0.41		0.19		0.14	0.15
Nonperforming assets as % of loans, net, foreclosed properties and loans held for sale		1.70	%	1.14		0.66		0.49	0.42

CAPITAL ADEQUACY (b)
Tier I capital ratio		7.5	%	7.4		7.1		7.5	7.4
Total capital ratio		12.1		11.8		10.8		11.5	11.4
Leverage ratio		6.2	%	6.1		6.1		6.2	6.1

OTHER DATA
Average basic common shares (In millions)		1,963		1,959		1,885		1,891	1,894
Average diluted common shares (In millions)		1,977		1,983		1,910		1,919	1,925
Actual common shares (In millions) (c)		1,992		1,980		1,901		1,903	1,913
Dividends paid per common share	$	0.64		0.64		0.64		0.56	0.56
Dividend payout ratio on common shares		(320.00	)%	2133.33		75.29		45.90	46.67
Book value per common share (c)	$	36.40		37.66		36.90		36.40	36.47
Common stock price		27.00		38.03		50.15		51.25	55.05
Market capitalization (c)	$	53,782		75,302		95,326		97,530	105,330
Common stock price to book value (c)		74	%	101		136		141	151
FTE employees		120,378		121,890		109,724		110,493	110,369
Total financial centers/brokerage offices		4,850		4,894		4,167		4,135	4,167
ATMs		5,308		5,139		5,123		5,099	5,146

(a)	Calculated using average basic common shares in the first quarter of 2008.

(b)	The first quarter of 2008 is based on estimates.

(c)	Includes restricted stock for which the holder receives dividends and has full voting rights.

PAGE 11

WACHOVIA CORPORATION AND SUBSIDIARIES

OTHER FINANCIAL DATA

(Unaudited)


	2008			2007
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter
EARNINGS EXCLUDING MERGER-RELATED AND RESTRUCTURING EXPENSES, AND DISCONTINUED OPERATIONS (a) (b)
Return on average common stockholders’ equity		(1.45	)%	1.62		9.81		13.66	13.50
Return on average assets		(0.12	)	0.16		0.94		1.34	1.35
Overhead efficiency ratio		65.85		75.48		59.73		55.65	55.75
Overhead efficiency ratio excluding brokerage		61.92	%	74.54		56.82		52.04	52.60
Operating leverage	$	877		(1,208	)	(843	)	210	(51	)

EARNINGS EXCLUDING MERGER-RELATED AND RESTRUCTURING EXPENSES, OTHER INTANGIBLE AMORTIZATION AND DISCONTINUED OPERATIONS (a) (b) (c)
Dividend payout ratio on common shares		(640.00	)%	355.56		68.09		44.09	45.16
Return on average tangible common stockholders’ equity		(2.80	)	5.05		23.88		33.57	33.27
Return on average tangible assets		(0.09	)	0.20		1.03		1.47	1.49
Overhead efficiency ratio		64.55		73.97		58.51		54.47	54.33
Overhead efficiency ratio excluding brokerage		60.14	%	72.40		55.32		50.61	50.88
Operating leverage	$	869		(1,187	)	(855	)	197	(75	)

OTHER FINANCIAL DATA
Net interest margin		2.92	%	2.88		2.92		2.96	3.06
Fee and other income as % of total revenue		39.15		36.99		39.02		48.58	45.15
Effective income tax rate (d)		40.04		122.05		27.33		32.78	30.22
Effective tax rate (Tax-equivalent) (d) (e)		34.06	%	127.17		28.38		33.51	30.99

AVERAGE BALANCE SHEET DATA
Commercial loans, net	$	198,578		188,164		174,672		165,512	157,288
Consumer loans, net		267,358		261,641		255,129		255,745	257,973
Loans, net		465,936		449,805		429,801		421,257	415,261
Earning assets		659,033		650,140		628,773		605,978	593,663
Total assets		783,593		763,487		729,004		704,773	691,029
Core deposits		394,513		390,043		379,009		378,496	369,270
Total deposits		443,353		437,566		416,107		408,418	399,106
Interest-bearing liabilities		611,099		599,130		574,399		547,669	535,778
Stockholders’ equity	$	78,747		73,986		69,857		69,317	69,320

PERIOD-END BALANCE SHEET DATA
Commercial loans, net	$	211,700		198,566		189,545		175,369	167,039
Consumer loans, net		268,782		263,388		259,661		253,751	254,624
Loans, net		480,482		461,954		449,206		429,120	421,663
Goodwill and other intangible assets
Goodwill		43,068		43,122		38,848		38,766	38,838
Deposit base		573		619		670		727	796
Customer relationships		1,375		1,410		620		651	684
Tradename		90		90		90		90	90
Total assets		808,890		782,896		754,168		715,428	702,669
Core deposits		398,562		397,405		377,865		378,188	377,358
Total deposits		444,964		449,129		421,937		410,030	405,270
Stockholders’ equity	$	78,307		76,872		70,140		69,266	69,786

(a)

These financial measures are calculated by excluding from GAAP net income (loss) presented on page 10, $123 million, $108 million, $22 million, $20 million and $6 million in the first quarter of 2008 and the fourth, third, second and first quarters of 2007, respectively, of after-tax net merger-related and restructuring expenses and $142 million and $88 million after tax in the fourth and third quarters of 2007, respectively, of discontinued operations.

(b)	See page 10 for the most directly comparable GAAP financial measure and pages 21 and 22 for a more detailed reconciliation.

(c)

These financial measures are calculated by excluding from GAAP net income (loss) presented on page 10, $64 million, $65 million, $59 million, $66 million and $76 million in the first quarter of 2008 and the fourth, third, second and first quarters of 2007, respectively, of deposit base and other intangible amortization.

(d)	The fourth and third quarters of 2007 include taxes on discontinued operations.

(e)	The tax-equivalent tax rate applies to fully tax-equivalized revenues.

PAGE 12

WACHOVIA CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)


	2008			2007
(In millions, except per share data)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter
INTEREST INCOME
Interest and fees on loans	$	7,577		7,980		7,937		7,723	7,618
Interest and dividends on securities		1,496		1,616		1,529		1,474	1,478
Trading account interest		571		557		566		506	433
Other interest income		535		757		799		647	611

Total interest income		10,179		10,910		10,831		10,350	10,140

INTEREST EXPENSE
Interest on deposits		2,941		3,433		3,334		3,180	3,014
Interest on short-term borrowings		523		673		801		706	669
Interest on long-term debt		1,963		2,174		2,145		2,015	1,957

Total interest expense		5,427		6,280		6,280		5,901	5,640

Net interest income		4,752		4,630		4,551		4,449	4,500
Provision for credit losses		2,831		1,497		408		179	177

Net interest income after provision for credit losses		1,921		3,133		4,143		4,270	4,323

FEE AND OTHER INCOME
Service charges		676		716		689		667	614
Other banking fees		498		497		471		449	416
Commissions		914		970		600		649	659
Fiduciary and asset management fees		1,439		1,436		1,029		1,015	953
Advisory, underwriting and other investment banking fees		261		249		393		454	407
Trading account profits (losses)		(308	)	(524	)	(301	)	195	128
Principal investing		446		41		372		298	48
Securities gains (losses)		(205	)	(320	)	(34	)	23	53
Other income		(630	)	(321	)	(286	)	490	456

Total fee and other income		3,091		2,744		2,933		4,240	3,734

NONINTEREST EXPENSE
Salaries and employee benefits		3,260		3,468		2,628		3,122	2,972
Occupancy		379		375		325		331	312
Equipment		323		334		283		309	307
Marketing		97		80		74		78	62
Communications and supplies		186		191		176		178	173
Professional and consulting fees		196		271		194		205	177
Other intangible amortization		103		111		92		103	118
Merger-related and restructuring expenses		241		187		36		32	10
Sundry expense		656		769		717		532	490

Total noninterest expense		5,441		5,786		4,525		4,890	4,621

Minority interest in income of consolidated subsidiaries		155		107		189		139	136

Income (loss) from continuing operations before income taxes (benefits)		(584	)	(16	)	2,362		3,481	3,300
Income taxes (benefits)		(234	)	(209	)	656		1,140	998

Income (loss) from continuing operations		(350	)	193		1,706		2,341	2,302
Discontinued operations, net of income taxes		—		(142	)	(88	)	—	—

Net income (loss)		(350	)	51		1,618		2,341	2,302
Dividends on preferred stock		43		—		—		—	—

Net income (loss) available to common stockholders	$	(393	)	51		1,618		2,341	2,302

PER COMMON SHARE DATA (after preferred stock dividends)
Basic earnings
Income (loss) from continuing operations	$	(0.20	)	0.10		0.91		1.24	1.22
Net income (loss) available to common stockholders		(0.20	)	0.03		0.86		1.24	1.22
Diluted earnings (a)
Income (loss) from continuing operations		(0.20	)	0.10		0.90		1.22	1.20
Net income (loss) available to common stockholders		(0.20	)	0.03		0.85		1.22	1.20
Cash dividends	$	0.64		0.64		0.64		0.56	0.56
AVERAGE COMMON SHARES
Basic		1,963		1,959		1,885		1,891	1,894
Diluted		1,977		1,983		1,910		1,919	1,925

(a)	Calculated using average basic common shares in the first quarter of 2008.

PAGE 13

WACHOVIA CORPORATION AND SUBSIDIARIES

BUSINESS SEGMENTS

(Unaudited)


	Three Months Ended March 31, 2008
(In millions)	General Bank		Wealth Management	Corporate and Investment Bank		Capital Management		Parent		Net Merger- Related and Restructuring Expenses (b)		Total
CONSOLIDATED
Net interest income (a)	$	3,455	181	1,032		274		(137	)	(53	)	4,752
Fee and other income		990	211	(159	)	2,191		(142	)	—		3,091
Intersegment revenue		55	5	(50	)	(10	)	—		—		—

Total revenue (a)		4,500	397	823		2,455		(279	)	(53	)	7,843
Provision for credit losses		569	5	197		—		2,060		—		2,831
Noninterest expense		2,050	246	747		1,855		302		241		5,441
Minority interest		—	—	—		—		198		(43	)	155
Income taxes (benefits)		675	54	(65	)	218		(1,041	)	(75	)	(234	)
Tax-equivalent adjustment		11	—	21		1		20		(53	)	—

Net income (loss)		1,195	92	(77	)	381		(1,818	)	(123	)	(350	)
Dividends on preferred stock		—	—	—		—		43		—		43

Net income (loss) available to common stockholders	$	1,195	92	(77	)	381		(1,861	)	(123	)	(393	)



	Three Months Ended December 31, 2007
(In millions)	General Bank		Wealth Management	Corporate and Investment Bank		Capital Management		Parent		Net Merger- Related and Restructuring Expenses (b)		Total
CONSOLIDATED
Net interest income (a)	$	3,402	183	988		318		(217	)	(44	)	4,630
Fee and other income		929	214	(555	)	2,211		(55	)	—		2,744
Intersegment revenue		58	3	(50	)	(11	)	—		—		—

Total revenue (a)		4,389	400	383		2,518		(272	)	(44	)	7,374
Provision for credit losses		320	7	112		—		1,058		—		1,497
Noninterest expense		2,041	249	952		1,938		419		187		5,786
Minority interest		—	—	—		—		118		(11	)	107
Income taxes (benefits)		730	53	(269	)	211		(866	)	(68	)	(209	)
Tax-equivalent adjustment		11	—	19		1		13		(44	)	—

Income (loss) from continuing operations		1,287	91	(431	)	368		(1,014	)	(108	)	193
Discontinued operations, net of income taxes		—	—	—		—		(142	)	—		(142	)

Net income (loss)	$	1,287	91	(431	)	368		(1,156	)	(108	)	51

PAGE 14

WACHOVIA CORPORATION AND SUBSIDIARIES

BUSINESS SEGMENTS

(Unaudited)


	Three Months Ended March 31, 2007
(In millions)	General Bank		Wealth Management	Corporate and Investment Bank		Capital Management		Parent		Net Merger- Related and Restructuring Expenses (b)		Total
CONSOLIDATED
Net interest income (a)	$	3,398	181	716		259		(17	)	(37	)	4,500
Fee and other income		845	196	1,109		1,477		107		—		3,734
Intersegment revenue		47	3	(43	)	(8	)	1		—		—

Total revenue (a)		4,290	380	1,782		1,728		91		(37	)	8,234
Provision for credit losses		147	1	6		—		23		—		177
Noninterest expense		1,869	247	911		1,237		347		10		4,621
Minority interest		—	—	—		—		136		—		136
Income taxes (benefits)		819	48	305		179		(349	)	(4	)	998
Tax-equivalent adjustment		11	—	10		—		16		(37	)	—

Net income (loss)	$	1,444	84	550		312		(82	)	(6	)	2,302

(a)	Tax-equivalent.

(b)	The tax-equivalent amounts are eliminated herein in order for “Total” amounts to agree with amounts appearing in the Consolidated Statements of Income.

PAGE 15

WACHOVIA CORPORATION AND SUBSIDIARIES

LOANS—ON-BALANCE SHEET, AND MANAGED AND SERVICING PORTFOLIOS

(Unaudited)


	2008			2007
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
ON-BALANCE SHEET LOAN PORTFOLIO COMMERCIAL
Commercial, financial and agricultural	$	119,193		112,509		109,269		102,397		99,687
Real estate—construction and other		18,597		18,543		18,167		17,449		16,965
Real estate—mortgage		26,370		23,846		21,514		20,448		20,130
Lease financing		23,637		23,913		23,966		24,083		24,053
Foreign		33,616		29,540		26,471		20,959		16,240

Total commercial		221,413		208,351		199,387		185,336		177,075

CONSUMER
Real estate secured		230,197		227,719		225,355		220,293		220,682
Student loans		9,324		8,149		7,742		6,757		8,479
Installment loans		27,437		25,635		24,763		25,017		23,665

Total consumer		266,958		261,503		257,860		252,067		252,826

Total loans		488,371		469,854		457,247		437,403		429,901
Unearned income		(7,889	)	(7,900	)	(8,041	)	(8,283	)	(8,238	)

Loans, net (On-balance sheet)	$	480,482		461,954		449,206		429,120		421,663

MANAGED PORTFOLIO (a)
COMMERCIAL
On-balance sheet loan portfolio	$	221,413		208,351		199,387		185,336		177,075
Securitized loans—off-balance sheet		120		131		142		170		181
Loans held for sale		3,342		9,414		13,905		11,573		10,467

Total commercial		224,875		217,896		213,434		197,079		187,723

CONSUMER
Real estate secured
On-balance sheet loan portfolio		230,197		227,719		225,355		220,293		220,682
Securitized loans—off-balance sheet		6,845		7,230		7,625		8,112		6,595
Securitized loans included in securities		11,683		10,755		5,963		6,091		5,629
Loans held for sale		5,960		4,816		3,583		4,079		4,089

Total real estate secured		254,685		250,520		242,526		238,575		236,995

Student
On-balance sheet loan portfolio		9,324		8,149		7,742		6,757		8,479
Securitized loans—off-balance sheet		2,586		2,811		2,856		2,905		3,045
Securitized loans included in securities		52		52		52		52		52
Loans held for sale		—		—		1,968		2,046		—

Total student		11,962		11,012		12,618		11,760		11,576

Installment
On-balance sheet loan portfolio		27,437		25,635		24,763		25,017		23,665
Securitized loans—off-balance sheet		1,968		2,263		2,572		3,105		2,851
Securitized loans included in securities		39		47		55		116		126
Loans held for sale		2,127		2,542		1,975		35		476

Total installment		31,571		30,487		29,365		28,273		27,118

Total consumer		298,218		292,019		284,509		278,608		275,689

Total managed portfolio	$	523,093		509,915		497,943		475,687		463,412

SERVICING PORTFOLIO (b)
Commercial	$	354,624		353,464		337,721		298,374		271,038
Consumer	$	27,415		27,967		28,474		26,789		25,952

(a)	The managed portfolio includes the on-balance sheet loan portfolio, loans securitized for which the retained interests are classified in securities on-balance sheet, loans held for sale on-balance sheet and the off-balance sheet portfolio of securitized loans sold, where we service the loans.

(b)	The servicing portfolio consists of third party commercial and consumer loans for which our sole function is that of servicing the loans for the third parties.

PAGE 16

WACHOVIA CORPORATION AND SUBSIDIARIES

ALLOWANCE FOR CREDIT LOSSES

(Unaudited)


	2008			2007
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
ALLOWANCE FOR CREDIT LOSSES (a)
Balance, beginning of period	$	4,717		3,691		3,552		3,533		3,514
Provision for credit losses		2,834		1,467		381		168		175
Provision for credit losses relating to loans transferred to loans held for sale or sold		7		6		3		4		1
Provision for credit losses for unfunded lending commitments		(10	)	24		24		7		1
LOAN LOSSES
Commercial, financial and agricultural		(171	)	(67	)	(41	)	(39	)	(34	)
Commercial real estate—construction and mortgage		(81	)	(117	)	(5	)	(4	)	(6	)

Total commercial		(252	)	(184	)	(46	)	(43	)	(40	)

Real estate secured		(351	)	(156	)	(59	)	(40	)	(33	)
Student loans		(3	)	(4	)	(5	)	(2	)	(3	)
Installment and other loans (b)		(242	)	(225	)	(168	)	(138	)	(142	)

Total consumer		(596	)	(385	)	(232	)	(180	)	(178	)

Total loan losses		(848	)	(569	)	(278	)	(223	)	(218	)

LOAN RECOVERIES
Commercial, financial and agricultural		14		22		9		15		9
Commercial real estate—construction and mortgage		1		—		3		—		3

Total commercial		15		22		12		15		12

Real estate secured		10		9		12		11		6
Student loans		1		2		3		—		1
Installment and other loans (b)		57		75		45		47		44

Total consumer		68		86		60		58		51

Total loan recoveries		83		108		72		73		63

Net charge-offs		(765	)	(461	)	(206	)	(150	)	(155	)

Allowance relating to loans acquired, transferred to loans held for sale or sold		(16	)	(10	)	(63	)	(10	)	(3	)

Balance, end of period	$	6,767		4,717		3,691		3,552		3,533

ALLOWANCE FOR CREDIT LOSSES
Allowance for loan losses	$	6,567		4,507		3,505		3,390		3,378
Reserve for unfunded lending commitments		200		210		186		162		155

Total allowance for credit losses	$	6,767		4,717		3,691		3,552		3,533

ALLOWANCE FOR LOAN LOSSES
as % of loans, net		1.37	%	0.98		0.78		0.79		0.80
as % of nonaccrual and restructured loans (c)		84		90		129		174		207
as % of nonperforming assets (c)		78		84		115		157		189
ALLOWANCE FOR CREDIT LOSSES
as % of loans, net		1.41	%	1.02		0.82		0.83		0.84

NET CHARGE-OFFS AS % OF AVERAGE LOANS, NET (d)
Commercial, financial and agricultural		0.41	%	0.12		0.10		0.07		0.08
Commercial real estate—construction and mortgage		0.73		1.12		0.02		0.04		0.04

Total commercial		0.48		0.34		0.08		0.07		0.07

Real estate secured		0.59		0.26		0.08		0.05		0.05
Student loans		0.08		0.10		0.14		0.07		0.10
Installment and other loans (b)		2.76		2.35		1.99		1.47		1.67

Total consumer		0.79		0.46		0.27		0.19		0.20

Total as % of average loans, net		0.66	%	0.41		0.19		0.14		0.15

CONSUMER REAL ESTATE SECURED NET CHARGE-OFFS
First lien	$	(291	)	(122	)	(32	)	(17	)	(15	)
Second lien		(50	)	(25	)	(15	)	(12	)	(12	)

Total consumer real estate secured net charge-offs	$	(341	)	(147	)	(47	)	(29	)	(27	)

(a)	The allowance for credit losses is the sum of the allowance for loan losses and the reserve for unfunded lending commitments.

(b)	Principally auto loans.

(c)	These ratios do not include nonperforming assets included in loans held for sale.

(d)	Annualized.

PAGE 17

WACHOVIA CORPORATION AND SUBSIDIARIES

NONPERFORMING ASSETS

(Unaudited)


	2008			2007
(In millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter
NONPERFORMING ASSETS
Nonaccrual loans
Commercial
Commercial, financial and agricultural	$	908		602	354	318	303
Commercial real estate - construction and mortgage		1,750		1,059	289	161	117

Total commercial		2,658		1,661	643	479	420

Consumer
Real estate secured
First lien		5,015		3,234	1,986	1,380	1,124
Second lien		75		58	41	44	37
Installment and other loans (a)		40		42	45	42	51

Total consumer		5,130		3,334	2,072	1,466	1,212

Total nonaccrual loans		7,788		4,995	2,715	1,945	1,632
Troubled debt restructurings (b)		56		—	—	—	—
Foreclosed properties		530		389	334	207	155

Total nonperforming assets	$	8,374		5,384	3,049	2,152	1,787

as % of loans, net, and foreclosed properties (c)		1.74	%	1.16	0.68	0.50	0.42

Nonperforming assets included in loans held for sale
Commercial	$	—		—	—	—	1
Consumer		5		62	59	42	25

Total nonperforming assets included in loans held for sale		5		62	59	42	26

Nonperforming assets included in loans and in loans held for sale	$	8,379		5,446	3,108	2,194	1,813

as % of loans, net, foreclosed properties and loans held for sale (d)		1.70	%	1.14	0.66	0.49	0.42

PAST DUE LOANS 90 DAYS AND OVER, AND NONACCRUAL LOANS (c)

Accruing loans past due 90 days and over	$	1,047		708	590	562	555
Nonaccrual loans		7,788		4,995	2,715	1,945	1,632

Total past due loans 90 days and over, and nonaccrual loans	$	8,835		5,703	3,305	2,507	2,187

Commercial as % of loans, net		1.31	%	0.89	0.38	0.31	0.28
Consumer as % of loans, net		2.26	%	1.49	1.00	0.78	0.68

(a)	Principally auto loans; nonaccrual status does not apply to student loans.

(b)	Troubled debt restructurings were not significant prior to the first quarter of 2008.

(c)	These ratios do not include nonperforming assets included in loans held for sale.

(d)

These ratios reflect nonperforming loans included in loans held for sale. Loans held for sale are recorded at the lower of cost or market value, and accordingly, the amounts shown and included in the ratios are net of the transferred allowance for loan losses and the lower of cost or market value adjustments.

PAGE 18

WACHOVIA CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)


	2008			2007
(In millions, except per share data)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
ASSETS
Cash and due from banks	$	14,703		15,124		12,681		12,065		12,593
Interest-bearing bank balances		3,236		3,057		4,449		2,726		2,591
Federal funds sold and securities purchased under resale agreements		10,644		15,449		11,995		11,511		10,322

Total cash and cash equivalents		28,583		33,630		29,125		26,302		25,506

Trading account assets		72,592		55,882		54,835		51,540		44,161
Securities		114,183		115,037		111,827		106,184		106,841
Loans, net of unearned income		480,482		461,954		449,206		429,120		421,663
Allowance for loan losses		(6,567	)	(4,507	)	(3,505	)	(3,390	)	(3,378	)

Loans, net		473,915		457,447		445,701		425,730		418,285

Loans held for sale		11,429		16,772		21,431		17,733		15,032
Premises and equipment		6,733		6,605		6,002		6,080		6,058
Due from customers on acceptances		1,109		1,418		1,295		831		992
Goodwill		43,068		43,122		38,848		38,766		38,838
Other intangible assets		2,038		2,119		1,380		1,468		1,570
Other assets		55,240		50,864		43,724		40,794		45,386

Total assets	$	808,890		782,896		754,168		715,428		702,669

LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits
Noninterest-bearing deposits		60,951		60,893		56,825		62,112		63,399
Interest-bearing deposits		384,013		388,236		365,112		347,918		341,871

Total deposits		444,964		449,129		421,937		410,030		405,270
Short-term borrowings		57,857		50,393		62,714		52,715		47,144
Bank acceptances outstanding		1,118		1,424		1,303		840		1,004
Trading account liabilities		28,887		21,585		17,771		19,319		17,291
Other liabilities		19,036		19,151		18,424		18,080		16,741
Long-term debt		175,653		161,007		158,584		142,047		142,334

Total liabilities		727,515		702,689		680,733		643,031		629,784

Minority interest in net assets of consolidated subsidiaries		3,068		3,335		3,295		3,131		3,099

STOCKHOLDERS’ EQUITY
Dividend Equalization Preferred shares, no par value, 97 million shares issued and outstanding at March 31, 2008		—		—		—		—		—
Non-Cumulative Perpetual Class A Preferred Stock, Series I, $100,000 liquidation preference per share, 25,010 shares authorized		—		—		—		—		—
Non-Cumulative Perpetual Class A Preferred Stock, Series J, $1,000 liquidation preference per share, 92 million depositary shares issued and outstanding at March 31, 2008		2,300		2,300		—		—		—
Non-Cumulative Perpetual Class A Preferred Stock, Series K, $1,000 liquidation preference per share, 3.5 million shares issued and outstanding at March 31, 2008		3,500		—		—		—		—
Common stock, $3.33-1/3 par value, authorized 3 billion shares, outstanding 1.965 billion shares at March 31, 2008		6,551		6,534		6,283		6,289		6,316
Paid-in capital		56,368		56,149		51,938		51,905		52,026
Retained earnings		11,763		13,456		14,670		14,335		13,378
Accumulated other comprehensive income, net		(2,175)		(1,567)		(2,751)		(3,263)		(1,934)

Total stockholders’ equity		78,307		76,872		70,140		69,266		69,786

Total liabilities and stockholders’ equity	$	808,890		782,896		754,168		715,428		702,669

PAGE 19

WACHOVIA CORPORATION AND SUBSIDIARIES

NET INTEREST INCOME SUMMARIES

(Unaudited)


	FIRST QUARTER 2008						FOURTH QUARTER 2007
(In millions)	Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid
ASSETS
Interest-bearing bank balances	$	4,253		51	4.85	%	$	5,083		64	5.05	%
Federal funds sold and securities purchased under resale agreements		11,865		103	3.49			12,901		155	4.77
Trading account assets		44,655		589	5.28			37,694		569	6.04
Securities		110,401		1,545	5.60			115,436		1,625	5.62
Loans
Commercial
Commercial, financial and agricultural		115,377		1,671	5.82			111,500		1,908	6.79
Real estate—construction and other		18,634		251	5.42			18,435		318	6.85
Real estate—mortgage		25,291		374	5.95			22,973		426	7.36
Lease financing		7,167		140	7.79			7,374		145	7.82
Foreign		32,109		389	4.86			27,882		380	5.42

Total commercial		198,578		2,825	5.72			188,164		3,177	6.70

Consumer
Real estate secured		231,392		3,926	6.79			227,893		4,042	7.08
Student loans		9,155		113	4.96			8,073		126	6.19
Installment loans		26,811		659	9.88			25,675		651	10.04

Total consumer		267,358		4,698	7.04			261,641		4,819	7.35

Total loans		465,936		7,523	6.48			449,805		7,996	7.08

Loans held for sale		11,592		223	7.71			18,998		360	7.53
Other earning assets		10,331		146	5.69			10,223		166	6.48

Total earning assets excluding derivatives		659,033		10,180	6.19			650,140		10,935	6.70
Risk management derivatives (a)		—		52	0.04			—		19	0.01

Total earning assets including derivatives		659,033		10,232	6.23			650,140		10,954	6.71

Cash and due from banks		11,645						12,028
Other assets		112,915						101,319

Total assets	$	783,593					$	763,487

LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits
Savings and NOW accounts		86,452		236	1.10			83,370		345	1.64
Money market accounts		128,074		747	2.34			121,717		949	3.09
Other consumer time		123,655		1,437	4.68			127,061		1,557	4.86
Foreign		26,197		231	3.55			27,354		306	4.44
Other time		22,643		265	4.71			20,169		263	5.16

Total interest-bearing deposits		387,021		2,916	3.03			379,671		3,420	3.57
Federal funds purchased and securities sold under repurchase agreements		35,956		308	3.45			36,386		413	4.50
Commercial paper		5,509		38	2.74			7,272		78	4.27
Securities sold short		6,919		62	3.63			6,728		61	3.62
Other short-term borrowings		10,154		45	1.77			10,369		58	2.24
Long-term debt		165,540		1,961	4.75			158,704		2,129	5.34

Total interest-bearing liabilities excluding derivatives		611,099		5,330	3.51			599,130		6,159	4.08
Risk management derivatives (a)		—		97	0.06			—		121	0.08

Total interest-bearing liabilities including derivatives		611,099		5,427	3.57			599,130		6,280	4.16

Noninterest-bearing deposits		56,332						57,895
Other liabilities		37,415						32,476
Stockholders’ equity		78,747						73,986

Total liabilities and stockholders’ equity	$	783,593					$	763,487

Interest income and rate earned—including derivatives			$	10,232	6.23	%			$	10,954	6.71	%
Interest expense and equivalent rate paid—including derivatives				5,427	3.31					6,280	3.83

Net interest income and margin—including derivatives			$	4,805	2.92	%			$	4,674	2.88	%

(a)	The rates earned and the rates paid on risk management derivatives are based on off-balance sheet notional amounts. The fair value of these instruments is included in other assets and other liabilities.

PAGE 20

WACHOVIA CORPORATION AND SUBSIDIARIES

NET INTEREST INCOME SUMMARIES

(Unaudited)


	THIRD QUARTER 2007						SECOND QUARTER 2007						FIRST QUARTER 2007
(In millions)	Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid		Average Balances		Interest Income/ Expense		Average Rates Earned/ Paid
ASSETS
Interest-bearing bank balances	$	6,459		93	5.68	%	$	3,384		50	6.00	%	$	1,523		30	7.80	%
Federal funds sold and securities purchased under resale agreements		14,206		194	5.42			12,110		158	5.25			14,124		177	5.07
Trading account assets		38,737		575	5.93			35,165		519	5.90			29,681		442	5.97
Securities		111,424		1,522	5.46			108,433		1,467	5.41			108,071		1,461	5.42
Loans
Commercial
Commercial, financial and agricultural		106,263		1,927	7.19			101,012		1,805	7.16			98,413		1,736	7.16
Real estate—construction and other		17,795		344	7.66			17,334		329	7.62			16,508		313	7.69
Real estate—mortgage		20,883		406	7.71			20,175		378	7.53			20,231		380	7.61
Lease financing		7,523		146	7.80			7,759		150	7.74			7,730		150	7.75
Foreign		22,208		308	5.53			19,232		265	5.51			14,406		196	5.49

Total commercial		174,672		3,131	7.12			165,512		2,927	7.09			157,288		2,775	7.15

Consumer
Real estate secured		223,356		4,070	7.28			222,096		4,042	7.28			225,909		4,148	7.36
Student loans		7,299		122	6.61			8,850		141	6.42			8,524		136	6.47
Installment loans		24,474		614	9.96			24,799		609	9.84			23,540		566	9.75

Total consumer		255,129		4,806	7.52			255,745		4,792	7.50			257,973		4,850	7.55

Total loans		429,801		7,937	7.35			421,257		7,719	7.34			415,261		7,625	7.40

Loans held for sale		20,209		363	7.14			17,644		285	6.47			16,748		255	6.16
Other earning assets		7,937		138	6.91			7,985		144	7.23			8,255		139	6.82

Total earning assets excluding derivatives		628,773		10,822	6.86			605,978		10,342	6.84			593,663		10,129	6.87
Risk management derivatives (a)		—		42	0.02			—		46	0.03			—		48	0.03

Total earning assets including derivatives		628,773		10,864	6.88			605,978		10,388	6.87			593,663		10,177	6.90

Cash and due from banks		11,134						11,533						12,260
Other assets		89,097						87,262						85,106

Total assets	$	729,004					$	704,773					$	691,029

LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits
Savings and NOW accounts		81,851		357	1.73			83,977		367	1.75			84,247		373	1.80
Money market accounts		116,404		980	3.34			111,562		976	3.51			107,785		917	3.45
Other consumer time		122,474		1,507	4.88			120,684		1,455	4.84			116,262		1,369	4.77
Foreign		23,322		292	4.97			21,871		270	4.96			20,802		249	4.85
Other time		13,776		187	5.40			8,051		107	5.30			9,034		119	5.36

Total interest-bearing deposits		357,827		3,323	3.68			346,145		3,175	3.68			338,130		3,027	3.63
Federal funds purchased and securities sold under repurchase agreements		44,334		556	4.98			38,031		473	4.98			35,142		430	4.97
Commercial paper		5,799		65	4.42			5,143		60	4.67			4,920		57	4.72
Securities sold short		7,420		70	3.74			7,158		67	3.75			8,709		83	3.86
Other short-term borrowings		7,793		55	2.74			7,688		52	2.77			6,898		44	2.54
Long-term debt		151,226		2,067	5.44			143,504		1,923	5.37			141,979		1,880	5.35

Total interest-bearing liabilities excluding derivatives		574,399		6,136	4.24			547,669		5,750	4.21			535,778		5,521	4.17
Risk management derivatives (a)		—		144	0.10			—		151	0.11			—		119	0.09

Total interest-bearing liabilities including derivatives		574,399		6,280	4.34			547,669		5,901	4.32			535,778		5,640	4.26

Noninterest-bearing deposits		58,280						62,273						60,976

Other liabilities		26,468						25,514						24,955
Stockholders’ equity		69,857						69,317						69,320

Total liabilities and stockholders’ equity	$	729,004					$	704,773					$	691,029

Interest income and rate earned—including derivatives			$	10,864	6.88	%			$	10,388	6.87	%			$	10,177	6.90	%
Interest expense and equivalent rate paid—including derivatives				6,280	3.96					5,901	3.91					5,640	3.84

Net interest income and margin—including derivatives			$	4,584	2.92	%			$	4,487	2.96	%			$	4,537	3.06	%

PAGE 21

WACHOVIA CORPORATION AND SUBSIDIARIES

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

(Unaudited)


		2008			2007
(In millions, except per share data)	*	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
INCOME (LOSS) FROM CONTINUING OPERATIONS
Net income (loss) (GAAP)	A	$	(350	)	51		1,618		2,341		2,302
Discontinued operations, net of income taxes (GAAP)			—		142		88		—		—

Income (loss) from continuing operations (GAAP)			(350	)	193		1,706		2,341		2,302
Merger-related and restructuring expenses (GAAP)			123		108		22		20		6

Earnings excluding merger-related and restructuring expenses, and discontinued operations	B		(227	)	301		1,728		2,361		2,308
Other intangible amortization (GAAP)			64		65		59		66		76

Earnings excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	C	$	(163	)	366		1,787		2,427		2,384

INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS
Net income (loss) available to common stockholders (GAAP)	D	$	(393	)	51		1,618		2,341		2,302
Discontinued operations, net of income taxes (GAAP)			—		142		88		—		—

Income (loss) from continuing operations available to common stockholders (GAAP)			(393	)	193		1,706		2,341		2,302
Merger-related and restructuring expenses (GAAP)			123		108		22		20		6

Income (loss) available to common stockholders excluding merger-related and restructuring expenses, and discontinued operations	E		(270	)	301		1,728		2,361		2,308
Other intangible amortization (GAAP)			64		65		59		66		76

Net income (loss) available to common stockholders, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	F	$	(206	)	366		1,787		2,427		2,384

RETURN ON AVERAGE COMMON STOCKHOLDERS’ EQUITY
Average common stockholders’ equity (GAAP)	G	$	74,697		73,599		69,857		69,317		69,320
Merger-related and restructuring expenses (GAAP)			110		242		124		14		1
Discontinued operations (GAAP)			—		(142	)	(88	)	—		—

Average common stockholders’ equity, excluding merger-related and restructuring expenses, and discontinued operations	H		74,807		73,699		69,893		69,331		69,321
Average intangible assets (GAAP)	I		(45,211	)	(44,941	)	(40,198	)	(40,328	)	(40,263	)

Average common stockholders’ equity, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	J	$	29,596		28,758		29,695		29,003		29,058

Return on average common stockholders’ equity
GAAP	D/G		(2.11	) %	0.28		9.19		13.54		13.47
Excluding merger-related and restructuring expenses, and discontinued operations	E/H		(1.45	)	1.62		9.81		13.66		13.50
Return on average tangible common stockholders’ equity GAAP	D/G+I		(5.36	)	0.71		21.64		32.38		32.14
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	F/J		(2.80	)%	5.05		23.88		33.57		33.27

RETURN ON AVERAGE ASSETS
Average assets (GAAP)	K	$	783,593		763,487		729,004		704,773		691,029
Average intangible assets (GAAP)			(45,211	)	(44,941	)	(40,198	)	(40,328	)	(40,263	)

Average tangible assets (GAAP)	L		738,382		718,546		688,806		664,445		650,766

Average assets (GAAP)			783,593		763,487		729,004		704,773		691,029
Merger-related and restructuring expenses (GAAP)			110		242		124		14		1
Discontinued operations (GAAP)			—		(142	)	(88	)	—		—

Average assets, excluding merger-related and restructuring expenses, and discontinued operations	M		783,703		763,587		729,040		704,787		691,030
Average intangible assets (GAAP)			(45,211	)	(44,941	)	(40,198	)	(40,328	)	(40,263	)

Average tangible assets, excluding merger-related and restructuring expenses, and discontinued operations	N	$	738,492		718,646		688,842		664,459		650,767

Return on average assets
GAAP	A/K		(0.18	)%	0.03		0.88		1.33		1.35
Excluding merger-related and restructuring expenses, and discontinued operations	B/M		(0.12	)	0.16		0.94		1.34		1.35
Return on average tangible assets
GAAP	A/L		(0.19	)	0.03		0.93		1.41		1.43
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	C/N		(0.09	)%	0.20		1.03		1.47		1.49

PAGE 22

WACHOVIA CORPORATION AND SUBSIDIARIES

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

(Unaudited)


		2008			2007
(In millions, except per share data)	*	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
OVERHEAD EFFICIENCY RATIOS
Noninterest expense (GAAP)	O	$	5,441		5,786		4,525		4,890		4,621
Merger-related and restructuring expenses (GAAP)			(241	)	(187	)	(36	)	(32	)	(10	)

Noninterest expense, excluding merger-related and restructuring expenses	P		5,200		5,599		4,489		4,858		4,611
Other intangible amortization (GAAP)			(103	)	(111	)	(92	)	(103	)	(118	)

Noninterest expense, excluding merger-related and restructuring expenses, and other intangible amortization	Q	$	5,097		5,488		4,397		4,755		4,493

Net interest income (GAAP)		$	4,752		4,630		4,551		4,449		4,500
Tax-equivalent adjustment			53		44		33		38		37

Net interest income (Tax-equivalent)			4,805		4,674		4,584		4,487		4,537
Fee and other income (GAAP)			3,091		2,744		2,933		4,240		3,734

Total	R	$	7,896		7,418		7,517		8,727		8,271

Retail Brokerage Services, excluding insurance	S	$	1,628		1,719		1,033		1,070		1,015
Noninterest expense (GAAP)

Net interest income (GAAP)		$	261		303		255		248		249
Tax-equivalent adjustment			1		1		—		—		—

Net interest income (Tax-equivalent)			262		304		255		248		249
Fee and other income (GAAP)			1,866		1,908		1,180		1,202		1,185

Total	T	$	2,128		2,212		1,435		1,450		1,434

Overhead efficiency ratios GAAP	O/R		68.91	%	78.00		60.20		56.02		55.88
Excluding merger-related and restructuring expenses	P/R		65.85		75.48		59.73		55.65		55.75
Excluding merger-related and restructuring expenses, and brokerage	P-S/R-T		61.92		74.54		56.82		52.04		52.60
Excluding merger-related and restructuring expenses, and other intangible amortization	Q/R		64.55		73.97		58.51		54.47		54.33
Excluding merger-related and restructuring expenses, other intangible amortization and brokerage	Q-S/R-T		60.14	%	72.40		55.32		50.61		50.88

OPERATING LEVERAGE
Operating leverage (GAAP)		$	823		(1,359	)	(847	)	189		(13	)
Merger-related and restructuring expenses (GAAP)			54		151		4		21		(38	)

Operating leverage, excluding merger-related and restructuring expenses			877		(1,208	)	(843	)	210		(51	)
Other intangible amortization (GAAP)			(8	)	21		(12	)	(13	)	(24	)

Operating leverage, excluding merger-related and restructuring expenses, and other intangible amortization		$	869		(1,187	)	(855	)	197		(75	)

DIVIDEND PAYOUT RATIOS ON COMMON SHARES
Dividends paid per common share	U	$	0.64		0.64		0.64		0.56		0.56

Diluted earnings per common share (GAAP)	V	$	(0.20	)	0.03		0.85		1.22		1.20
Merger-related and restructuring expenses (GAAP)			0.06		0.05		—		0.01		—
Other intangible amortization (GAAP)			0.04		0.03		0.04		0.04		0.04
Discontinued operations (GAAP)			—		0.07		0.05		—		—

Diluted earnings per common share, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	W	$	(0.10	)	0.18		0.94		1.27		1.24

Dividend payout ratios
GAAP	U/V		(320.00	)%	2,133.33		75.29		45.90		46.67
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	U/W		(640.00	)%	355.56		68.09		44.09		45.16

The letters included in the columns are provided to show how the various ratios presented in the tables on pages 21 and 22 are calculated. For example, return on average assets on a GAAP basis is calculated by dividing income (GAAP) by average assets (GAAP) (i.e., A/K) and annualized where appropriate.

Wachovia Corporation

1Q08 Financial Highlights

April 14, 2008

Loss

$350

million,

EPS

(a)

($0.20)

Operating loss of $270 million, EPS of ($0.14)

Core strength in General Bank, Capital Management and Wealth Management

overwhelmed by credit costs and continued market disruption losses

$2.8 billion provision including $1.1 billion Pick-a-Pay reserve build

Enhanced Pick-a-Pay credit modeling with greater emphasis on forecasted future changes in

customer behaviors assuming continued house price depreciation, particularly in stressed

markets

Expect further robust provisioning in 2008-2009

$2.0 billion of market disruption-related losses including $729 million on unfunded leveraged

finance positions

Proactive actions provide solid foundation in order to further strengthen the

balance sheet and build capital to top tier levels

Reduce dividend by 41% to quarterly level of $0.375 per share

Annual capital retention of $2.1 billion

Plans

raise

capital

approximately

billion

through

public

offering

Provides capacity to build Tier 1 capital ratio in excess of 8.8% by YE2009

Results significantly

affected by higher

credit costs and

continued market

disruption-related

losses

Significant actions

taken to strengthen

the balance sheet

1Q08 Quarterly highlights

(a) EPS calculated on net loss available to common stockholders of $393 million, reflecting preferred dividends of $43

million.

Financial highlights

Results include $2.1 billion reserve build

and $2.0 billion of market disruption losses

somewhat offset by $445 million of FAS

157/159 fair value net gains and Visa IPO

gain of $225 million

NII up 6% YoY and up 3% QoQ on strong

earning asset growth and improved margin

Low-cost core deposits up 7% YoY; up 3%

QoQ

Fees down 17% YoY on higher market

disruption losses;

up 13% QoQ

Effects of market disruption overwhelm

underlying strength in traditional banking

Expenses up 18% YoY and down 6% QoQ

QoQ declines driven by lower incentives

somewhat offset by higher FAS123R expense

New dividend level consistent with

anticipated 40-50% cash payout ratio over

intermediate horizon

Outlook for 2008 on page 32

($ in millions, except per share data)

1Q08

4Q07

1Q07

Net interest income

4,805

Fee and other income

3,091

(17)

Total revenue

7,896

(5)

Provision

2,831

Expense

5,441

(6)

Minority interest

155

Pre-tax income (loss)

(531)

Income taxes (benefits)

(181)

Net income (loss)

(350)

Preferred dividends

Net income (loss) available to

common stockholders

(393)

Net merger-related

123

Operating income (loss)/

continuing operations

(270)

Avg

basic shares

1,963

EPS

(0.20)

EPS operating

(0.14)

Net interest margin

2.92

bps

(14)

Return

avg

equity

(2.11)

Overhead efficiency ratio

68.91

(909)

bps

Balance sheet strengthening

Building capital and reserves

Capital preservation and build

Provides ability to operate from a position

of strength

Reducing dividend to quarterly rate of

$0.375; preserves $2.1 billion of capital

annually

Targeting

50%

cash

payout

ratio

(a)

Hypothetical $7 billion common /

convertible preferred capital raise would

add 150

bps to Tier 1 Capital ratio

(b)

Credit reserve build

Refined reserve

modeling;

use of new dynamic model results in higher expected loss factors on

Pick-a-Pay

Results

current

modeled

charge-offs

and

additional

reserve

$3.2

$3.8

billion

2008

and

$2.4

$2.8

billion

2009

and

allowance

loan

ratio

approximately

2.5%

2.8%

2009

(a)

Additional granularity on future loss expectations in stressed MSAs based on changing consumer behaviors

tied to declining home prices; less reliant on historical frequency and loss severity experience

(a) Before net merger-related and restructuring expenses, other intangible amortization and discontinued operations.

(b) Assumes estimated Net Risk Weighted Assets at 3/31/08; $3.5 billion of common and $3.5 billion of convertible preferred capital issued and one year benefit at reduced quarterly

dividend rate of $0.375 per share.

(a) As of March 31, 2008, see important assumptions as outlined on page 21. Future changes in assumptions could cause forecasts to change.

Dividend Yield

(c)

9.2%

6.9%

5.5%

5.4%

4.4%

3.6%

$2.56

BAC

$1.50

WFC

JPM

Capital Ratios

1Q08

(a)

4Q07

Tier 1

7.5

7.4

bps

Total Capital

12.1

11.8

Leverage

6.2

6.1

bps

Strong liquidity and capital position

Proactively managing liquidity and capital for

challenging environment

Retail franchise provides significant deposit

funding

Capital ratios hold steady

1Q08 $3.5 billion preferred stock offering; strong

demand

Lower dividend preserves 35 bps of Tier 1

capital annually

Plans to further enhance capital ratios

Wachovia Bank, N.A. has generally been a

liquidity provider to the market throughout

the market disruption

Wachovia Corporation continues to maintain

a very prudent liquidity profile

Period end as of 3/31/08.

10%

22%

55%

Stable Liability Funding

87% funded by Deposits, LTD & Equity

Total

Deposits

Other

Liab

Debt

Equity

(a)

1Q08

capital

ratios

are

based

estimates.

Market disruption losses and write-downs

(a) Net of associated hedges.

(b) 4Q07 includes $50 million of provision expense relating to loan impairments.

Market

Disruption-Related

Losses,

Net

(a)

2007/

2008

($ in millions)

1Q08

4Q07

3Q07

Life-to-Date

Corporate and Investment Bank

ABS CDO and other subprime-related

(339)

(818)

(230)

(1,387)

Commercial mortgage (CMBS)

(521)

(600)

(488)

(1,609)

Consumer mortgage

(251)

(123)

(82)

(456)

Leveraged finance

(309)

(272)

(488)

Other

(144)

(109)

(194)

Total

(1,564)

(1,389)

(1,181)

(4,134)

Capital Management

Asset-backed commercial paper

(17)

(40)

(57)

Parent

Impairment losses

(b)

(409)

(94)

(503)

Total, net

(1,973)

(1,500)

(1,221)

(4,694)

Discontinued operations

(BluePoint)

(210)

(120)

(330)

Average deposit growth

7% YoY core deposit growth

Low cost core up 7% YoY on strong money

market and checking sales

1Q08 deposit growth driven by

Retail brokerage FDIC sweep deposits

increase of $5.0 billion

Strong commercial results on treasury and

trade finance sales

Checking account net new sales of 174,000

Leveraging World Savings franchise

De novo branch expansion

Way2Save product launch

Results exceeding expectations with 33% of

accounts generating a new checking account

($ in billions)

1Q08

4Q07

1Q07

DDA

56.3

(3)

(8)

Interest checking

53.1

Savings

33.4

Money market

128.1

Low-cost core

270.9

Retail CDs

123.6

(3)

Core deposits

394.5

Other deposits

48.9

Total deposits

443.4

Core Deposit Growth

$369.3

$378.5

$379.0

$390.0

$394.5

1Q07

2Q07

3Q07

4Q07

1Q08

Low-Cost Core Deposits

Other Core Deposits

Average loan growth

Loans up 12% YoY and 4% QoQ

Strength in commercial, commercial real estate,

traditional mortgage and auto

Traditional mortgage up 10% YoY on

disciplined originations of marketable

mortgages; Pick-a-Pay mortgage up 2% as

slower prepay speeds offset lower volumes

C & I up 28% YoY on strength in large

corporate and middle-market and included

net $2.5 billion in foreign commercial real

estate and commercial loans transferred from

held-for-sale in 1Q08

CRE up 20% YoY on organic growth and

$2.5

billion in loans transferred from held-for-

sale in late 4Q07 and 1Q08

Current outlook:

Modest growth expectations for remainder of

2008

($ in billions)

1Q08

4Q07

1Q07

Pick-a-Payment mortgage

121.0

Traditional mortgage

52.6

Home equity

57.8

(3)

Other consumer

36.0

Total consumer

267.4

Commercial and industrial

154.7

Commercial real estate

43.9

Total commercial

198.6

Total loans, net

465.9

General Bank key metrics

Average loans up 8% YoY

Mortgage originations down 11%; higher

marketable production offset by lower Pick-a-

Pay volumes

Home equity down 41% reflecting

implementation of tightened credit standards

> 95%

direct channel originations

Auto originations up 26%

Average deposits up 5% YoY

1Q08 net new checking account sales of

174,000, including 139,000 checking accounts

linked to Way2Save accounts

Debit/credit card purchase volume up 18%

YoY

Opened 23 de novo branches and

consolidated 58

branches in 1Q08

New/lost ratio of 1.27

Retail customer acquisition rate of 14.9%;

attrition of 11.7%

Customer satisfaction remains best in class

(a) Volume of purchase activity on debit and credit cards.

(b) Percentage of customers who rate Wachovia a 7 on all three loyalty questions

(scale 1-7). Goal: 55%. Results based on Gallup survey.

households exclude single service mortgage.

(d) New commercial banking relationship or customer with no prior loan or

deposit account.

($ in millions)

1Q08

4Q07

1Q07

Product originations

Mortgage

12,787

(11)

First lien home equity

2,148

(9)

(29)

Second lien home equity

2,689

(29)

(47)

Auto

3,720

Avg

loans, net

311,447

Net new checking

174,431

(35)

Avg

core deposits

297,680

Card

purchase

volume

(a)

17,424

(2)

Customer

loyalty

(b)

52.50

(50)

bps

New/Lost

ratio

(c)

1.27

(5)

Commercial customer

acquisition

(d)

310

(15)

(16)

General Bank summary

Segment earnings of $1.2 billion, down 17%

YoY and 7% QoQ largely reflecting rising

credit costs

NII reflects balance sheet growth despite

margin compression and rising NPAs

Fees up 17% YoY reflecting strong fee

growth in most categories

Strong service charge and interchange income

growth on higher volumes

Mortgage banking fees up on higher marketable

origination volumes

Investment sales referral income up on in-bank

annuity sales

Modest expense growth

34% of expense increase driven by higher

credit-related expenses and 18% by growth

initiatives

Provision driven by higher losses in

consumer real estate and auto

($ in millions)

1Q08

4Q07

1Q07

Net interest income

3,455

Service charges

572

(6)

Interchange income

186

(2)

Mortgage

banking

fees

All

other

fees/ income

163

Fee and other income

990

Total revenue

4,500

Provision

569

Expense

2,050

Segment earnings

1,195

(7)

(17)

211

Wealth Management summary

Segment earnings of $92 million

Up 10% YoY and 1% QoQ in spite of

environmental headwinds

Revenues up 4% YoY

NII flat YoY as loan growth was offset by

deposit spread compression

Fees up 8% YoY as growth in fiduciary and

asset management fees offset lower insurance

commissions

Investment management sales remain strong

but down YoY on market volatility and wealth

lens client segmentation

Expenses flat YoY on continued focus on

tight expense management

AUM up 5% YoY

(a)

Assets

under

management

include

$39

billion

assets

managed

and

reported

Capital

Management.

(b) Trust and Investment Management new recurring fee sales.

($ in millions)

1Q08

4Q07

1Q07

Net interest income

181

(1)

Fee and other income

(1)

Total revenue

397

(1)

Provision

(29)

Expense

246

(1)

Segment earnings

Avg

loans, net

22,413

Avg

core deposits

17,397

AUM

(a)

79,834

(5)

Investment

mgmt

sales

(b)

14.0

(22)

Revenue/

(c)

2.9

Wealth Mgmt producers

970

(2)

Corporate and Investment Bank summary

Segment loss of $77 million

Net market disruption losses of $1.6 billion

reflecting lower valuations in virtually all asset

classes

Results include $729 million loss on unfunded

leveraged finance commitments

Principal investing gains of $414 million

included $486 million in FAS 157 net gains

Strong performance in high grade, global rate

products and equities offset by lower results in

structured products and leveraged finance

Expenses down 18% YoY on lower

revenue-based incentive compensation

Additional planned markets-related

headcount reductions of 450 –

550 FTEs

and additional cost reductions will benefit

margins further in 3Q08

Provision driven by higher losses on

residential-related commercial real estate

Loans up 38% YoY driven by growth in

commercial real estate and international

trade finance and reflects transfers from

held for sale to the portfolio

($ in millions)

1Q08

4Q07

1Q07

Principal Investing

414

IB originations

401

(9)

Capital markets

(875)

(3)

Lending

599

Treasury and Trade Finance

284

Total revenue

823

(54)

Provision

197

Expense

747

(22)

(18)

Segment loss

(77)

(82)

Avg

loans, net

101,024

Avg

core deposits

33,623

(7)

(2)

Lending commitments

113,521

(4)

($ in millions)

1Q08

4Q07

3Q07

ABS CDO and other

subprime-related

(339)

(818)

(230)

Commercial mortgage (CMBS)

(521)

(600)

(488)

Consumer mortgage

(251)

(123)

(82)

Leveraged finance

(309)

(272)

Other

(144)

(109)

Total CIB market disruption-

related losses

(1,564)

(1,389)

(1,181)

Discontinued ops

(BluePoint)

(210)

(120)

1Q08 net valuation losses of $521 million including

losses on $3.5 billion of loans moved from held-for-

sale in 1Q08

Results reflect continued spread widening despite solid

underlying fundamentals

Net exposure of $3.0 billion as of 3/31/08

$3.5 billion income producing commercial real

estate loans moved to the portfolio in 1Q08

Sold $4.2 billion during the quarter

Reduced hedging as overall levels decreased

Commercial mortgage and leveraged finance

Distribution-related exposure

Leveraged finance

1Q08 net valuation losses of $309

million

Assumes 100% funding of current unfunded commitments

Net exposure of $8.2 billion including $6.5 billion of unfunded commitments

$1.3 billion of exposure, including $750 million of outstandings, moved to the portfolio in 1Q08

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

$20,000

2Q07

3Q07

4Q07

1Q08

Gross MTM Exposure

Net MTM Exposure

Commercial mortgage (CMBS)

($ in millions)

Corporate and Investment Bank

Remaining distribution exposure

(a)

At 3/31/08, $2.0 billion is hedged with highly rated monoline financial guarantors; $900 million with a AA-rated large European bank; $1.2 billion with a large AA-rated global

multi-line insurer, both under margin agreements.

Subprime-related, CMBS and Leveraged Finance

3/31/08

Distribution Exposure, Net

Exposure

3/31/08

Hedged With

3/31/08

12/31/07

3/31/08

Gross

Various

Net

($ in millions)

Exposure

Instruments

Exposure

12/31/07

ABS CDO-related exposures:

Super senior ABS CDO exposures

High grade

2,403

(2,403)

Mezzanine

2,038

(1,599)

439

613

(28)

CDO-squared

Total super senior ABS CDO exposures

4,441

(4,002)

439

613

(28)

Other retained ABS CDO-related exposures

208

(68)

Total

ABS

CDO-related

exposures

(a)

4,508

(4,002)

506

821

(38)

Subprime RMBS exposures:

AAA rated

1,684

1,948

(14)

Below AAA rated (net of hedges)

(365)

(253)

Total subprime RMBS exposures

1,319

1,695

(22)

Total subprime-related exposure

5,827

(4,002)

1,825

2,516

(27)

Commercial mortgage-related (CMBS)

3,793

(840)

2,953

7,564

(61)

Leveraged finance (net of applicable fees)

n.a.

8,157

9,149

(11)

Capital Management key metrics

Series 7 brokers consistent with 4Q07 levels

Growth in high-producing brokers offset by

lower-producing broker attrition

Series 6 reps up 23% QoQ on growth

throughout the footprint and Western

expansion

Recurring revenue percentage in Retail

Brokerage up 160 bps YoY

Managed account assets up 35% YoY

FDIC sweep deposits up 35% YoY

Record annuity sales in 1Q08, up 52% YoY

and 19% QoQ

AUM down 18% YoY on 2Q07 change in

investment management discretion on $34

billion which had minimal impact on fees

Gross fluctuating fund flows down 2%

YoY excluding $1B 1Q07 Evergreen closed-

end fund offering

Retail money market net flows up 203% YoY

(a) Annualized.

(b)

Assets

under

management

include

$39

billion

assets

managed

for

Wealth

Management,

which

are

also

reported

that

segment.

2Q07

there

was

$34

billion change in investment discretion of previously co-managed AUM, now solely managed by Wealth Management.

($ in billions)

1Q08

4Q07

1Q07

Retail Brokerage

Series 7 brokers

14,583

Bank series 6 reps

4,059

Managed acct assets

190.3

(6)

Avg

FDIC sweep deposits

42.1

Client assets

1,118.5

(4)

Recurring revenue

61.8

bps

160

Rev/broker

(000)

(a)

584

(3)

(17)

In-bank revenue

(millions)

282

Loan originations

1.7

Pre-tax margin

24.3

140

bps

(550)

Asset Management

Total AUM

(b)

258.7

(6)

(18)

Gross fluctuating

fund flows

2.6

(30)

Pre-tax margin

25.3

160

bps

530

Capital Management summary

Segment earnings of $381 million up 22%

YoY driven by the addition of AG Edwards

Revenues up 42% YoY driven by

acquisitions and managed account asset

growth

NII up 6% on strong FDIC sweep deposit

growth partially offset by spread compression

Commissions up 54% on addition of AGE

which contributed $319 million during the

quarter

Fiduciary and asset management fees up

53%; up 11% before the benefit of acquisitions

AGE revenue retention in line with original

expectations

Expenses up 50% YoY driven by $572

million related to acquisitions

Excluding acquisitions, expenses up 4%

driven by salaries and employee benefits, and

legal costs

($ in millions)

1Q08

4Q07

1Q07

Net interest income

274

(14)

Commissions

824

(3)

Fiduciary/ asset mgmt

1,304

(1)

Other fee income

(29)

Fee and other income

2,191

(1)

Total revenue

2,455

(3)

Provision

Expense

1,855

(4)

Segment earnings

381

Avg

loans, net

2,562

Avg

core deposits

43,084

Credit quality

Increase in NPAs reflects significant

weakness in the housing market

particularly in specific regions of California

and Florida

Provision of $2.8 billion; net charge-offs of

$765 million or 66 bps

Commercial net charge-offs of $237 million, up

$75 million QoQ; included $126 million from

Real Estate Financial Services

1Q08 results include a $66 million loss on a

loan backed by ABS securities in CIB

Consumer net charge-offs of $528 million, up

$229 million QoQ

Consumer real estate losses of $341 million

include Pick-a-Pay losses of $240 million

Installment losses of $185 million, up $35

million QoQ driven by higher consumer DDA

overdraft losses; auto losses up $6 million

(a) Excludes nonperforming assets in loans held for sale.

($ in millions)

1Q08

4Q07

1Q07

Nonaccrual loans

7,788

4,995

1,632

Restructured loans

Foreclosed properties

530

389

155

Total NPAs

8,374

5,384

1,787

as % of loans, net ORE

(a)

1.74

1.16

0.42

Provision

2,831

1,497

177

Net charge-offs

765

461

155

Commercial

0.48

0.34

0.07

Consumer

0.79

0.46

0.20

Total c/o ratio

0.66

0.41

0.15

Commercial past dues

0.05

0.03

Consumer past dues

0.35

0.23

0.20

Allowance for credit losses

Allowance for credit losses of $6.8 billion

increased $3.2 billion from 1Q07 to 1.41% of

loans

Covers 1Q08 annualized net charge-offs 2.2

times

Provision of $2.8 billion exceeded charge-offs

by $2.1 billion

$1.6 billion due to higher expected loss factors

for Pick-a-Pay, home equity, auto and traditional

mortgage on significant market weakness and

changing consumer behaviors

Pick-a-Pay allowance ratio of 155 bps vs. 66 bps

in 4Q07

Home equity allowance ratio of 79 bps

Auto portfolio allowance ratio of 321 bps

$138 million commercial over provision on higher

frequency and loss severity expectations

$116 million commercial real estate over

provision including $98 million of FAS 114

reserves

$165 million increase in unallocated reserves

($ in millions)

1Q08

4Q07

1Q07

Allowance for loan losses

6,567

4,507

3,378

Allowance for credit losses

6,767

4,717

3,533

Allowance for loan losses

as % of loans, net

1.37

0.98

0.80

Commercial

1.25

1.20

1.12

Consumer

1.34

0.74

0.53

as % of nonaccrual and

restructured loans

207

as % of NPAs

189

Allowance for credit losses

as % of loans, net

1.41

1.02

0.84

Mortgage portfolio

Average traditional mortgage LTV of 72%;

average FICO score of 732

Traditional mortgage NPAs up $303 million QoQ;

current average LTV of 79%

(b)

1Q08 results include $253 million of NPAs relating to

$2.8 billion of non-branch originated Alt-A loans in CIB

transferred at market value from HFS to the portfolio at

an average LTV of 81%; these loans have no associated

allowance

Average Pick-a-Pay LTV of 71%

Pick-a-Pay NPAs up $1.6 billion QoQ; current average

LTV of NPAs of 89%

(b)

Trends largely reflect the continued effect of declining

home values, particularly in stressed areas such as CA

and FL

Tightening underwriting standards based on

geographic risk

FICO >

700 and max LTV of 60% in markets with

significant home price declines

FICO >

660 and max LTV of 80% in most stable markets

Focused on aggressive resolution of problem assets

with accelerated disposition of foreclosed properties

Sold 825 properties in 1Q08; new inflows to REO of

1,107

All FICO scores and LTVs at origination unless otherwise noted.

(a)

Includes other non Pick-a-Pay product balances of $6.0 billion in 1Q08, $5.4

billion in 4Q07, and $3.0 billion in 1Q07.

(b) Based on AVM automated valuation method using February data.

($ in millions)

1Q08

4Q07

1Q07

Traditional mortgage

48,932

47,991

43,934

NPAs

560

257

141

as a % of loans

1.15

0.54

0.32

Net charge-offs

as % of avg

loans

0.23

0.13

0.04

Pick-a-Pay

(a)

121,161

119,630

117,506

NPAs

4,623

3,052

924

as a % of loans

3.82

2.55

0.79

Net charge-offs

240

as % of avg

loans

0.79

0.31

Wachovia Mortgage 

90+ days past due vs. industry

Source: Industry Prime, Alt-A, Subprime and NegAm ARM delinquency data from LoanPerformance,

a unit of First American CoreLogic.

10%

11%

12%

13%

14%

WB Traditional

Pick-a-Pay

Industry Prime

Industry Alt-A

Industry Subprime

Industry Prime ARM NegAm

Consumer real estate

Key market statistics

($ in millions)

(a) AVM is automated valuation method using February data. Source: Veros.

(b) Portfolio-weighted OFHEO index for home price changes.

Region

Outstandings

Original LTV

Current

LTV -

AVM

(a)

OFHEO Change

Peak -

1Q08

(b)

Forecast

1Q08 -

Trough

(c)

Original

FICO

Current

FICO

$70,579

-7.6%

-6.4%

666

657

$12,030

-8.7%

-8.5%

683

662

$5,660

-3.3%

-6.9%

692

686

$3,095

-8.8%

-18.7%

681

674

$2,986

N/A

679

661

Other States

$26,810

-2.4%

-5.2%

687

678

Total Pick-a-Pay

$121,161

-6.1%

-6.8%

674

664

$8,351

730

727

$7,483

742

753

$4,171

732

731

$3,931

731

732

$3,454

725

722

Other States

$21,541

731

732

Total

$48,932

732

734

Total Mortgage

$170,093

690

684

$12,169

728

723

$7,358

733

732

$6,047

730

727

$6,033

731

732

$4,876

733

734

Other States

$23,620

724

719

Total Home Equity

$60,104

726

725

Pick-a-Pay mortgage

Refined reserve modeling in 1Q08

-8.5%

-8.7%

Florida

-6.4%

-7.6%

California

-6.8%

-6.1%

Nationwide

1Q08 –

Trough

Peak –

1Q08

Portfolio-weighted OFHEO-

based home price forecasts

At 3/31/08, new model results in a higher 12-month forward view of expected losses that required additional

portfolio reserves of $1.1 billion due to increased propensity to default tied to further home price declines

Reflects

February

current

LTVs

which

indicate

that

approximately

14%

the

Pick-a-Pay

portfolio

has

current

LTV > 100% with 75% in California and 10% in Florida

More precisely captures key factors observed to drive default rates and economic losses

Reflects

February

estimated

traditional

correlation

between

borrower

credit

profile

and

default

frequency

but

incorporates

the

view

that

changes

borrowers’

equity

levels

are

greater

predictor

future

losses

than

FICO

scores

Includes approximately 20 loan / borrower characteristics to further enhance loss forecast by:

Borrower propensity to default and loss severity correlated to changes in the OFHEO index

Connecting borrower equity to projected changes in home prices by geographic region

Model variables influenced by management’s current economic outlook:

Full year 2008 GDP of flat to 1% growth with negative growth in first half

Rising unemployment reaches 6% sometime in 2009

Management forecast of the OFHEO index: Currently estimate that we are roughly halfway through the housing

price decline

Utilized newly developed loss forecasting model that more strongly correlates forward

expected losses to changes in home prices and the resulting change in consumer

behavior on default frequency and loss severity; less reliant on

historical roll rates

Expect

trough to

occur in

mid-09

Pick-a-Pay mortgage 

Modeled credit costs

Actual

Full Year

4Q07

1Q08

2008

2009

Charge-offs

$0.09

$ 0.2

$1.3 -

1.7

$2.4 -

2.8

Additional provision

0.55

1.1

1.9 -

2.1

Total credit costs

0.64

1.3

3.2 –

3.8

2.4 –

2.8

Ending allowance

$0.82

$2.0

$2.7 -

2.9

$2.7 –

2.9

Ending

allowance/loans

(b)

0.7%

1.6

2.4% -

2.7%

2.5% -

2.8%

($ in billions)

The

above

modeled

output

builds

estimated

cumulative

losses

range

–

over

the

remaining

life of the pool

As an illustration, a 7.5% cumulative loss scenario could imply that 20% of the loans in the portfolio

default through foreclosure and suffer a loss of 45% of the original property values, on average, assuming

loans were originated at a 75% LTV, plus disposition costs of 10% of the loan balance

These forecast outcomes may be affected by changes in a variety of factors including actual home price

trends, economic conditions, changes in borrower behavior, regulatory changes and loss mitigation

strategies

(a) Based on assumptions on page 21, as of March 31, 2008. Future changes in assumptions could cause forecasts to change.

(b) Assumes forecasted loan balances for 2008 and 2009.

Pick-a-Pay Modeled Credit Costs

(a)

None expected

Wachovia Pick-a-Pay 

March 2008 deferred interest analysis

Deferred interest of $3.5 billion represented 3.04%

of the portfolio

(a)

$176 million in deferred interest associated with nonperforming loans, 3.77% of NPAs

Borrowers utilization of minimum payment option remains fairly constant

68% elected in March 2008 vs. 66% in March 2007

52% elected the minimum option in each of the past 6 months

41% elected the minimum option in each of the past 12 months

$1.2 billion, or less than 1% of borrowers, with a deferred interest balance > 10% of current balance

Current average LTV

(b)

of 82% for loans with deferred interest balance > 10% of current balance

(a)

$115.0

billion

Pick-a-Pay

product

excludes

other

balances

$6.2

billion.

(b) Current average LTVs based on February 2008 AVMs. Source: Veros.

($ in millions)

1Q08

4Q07

1Q07

Deferred interest balance by LTV

At or below 80%

60% or less

329

305

231

60.01% to 70%

434

402

298

70.01% to 80%

1,090

991

699

Subtotal

1,853

1,698

1,228

80.01% to 85%

1,033

935

617

85.01% to 90%

466

327

Greater than 90%

174

129

Subtotal

1,673

1,391

721

Total deferred interest

3,526

3,089

1,949

Wachovia Pick-a-Pay 

Proactively managing risk

Significantly tightening underwriting standards based on geographic risk with particular focus

on stressed markets in California and Florida

In markets that have experienced significant housing price declines, we are increasing

minimum

FICO

scores

700

and

will

allow

maximum

LTV

60%

In our most stable markets, our minimum FICO will be 660 and we will allow up to a maximum

LTV of 80%

Conservative in-house appraisal and underwriting approach

Aggressive problem loan resolution

Enhanced collection and loss mitigation

Accelerated disposition of foreclosed properties

Continue

offer

conforming

mortgage

products

throughout

all

our

markets

Home equity loans and lines

45% secured by first lien

75% average LTV

(a)

Portfolio is predominantly customer-

relationship based

> 95% of the portfolio originated through

direct channels

5% of portfolio in CA and 20% in FL

NPAs up 15 bps QoQ but remain at relatively

low levels

Second lien home equity 60+ days past due are

40%

the

industry

average

(b)

Charge-offs up 22 bps QoQ driven by

increases in stressed geographies

Implementing additional limitations on

utilization of undrawn equity lines

Period end balances reflect the quarter-end transfer of $2.3 billion of first lien home equity loans to held for sale.

(a) FICOs and LTVs at origination unless otherwise noted.

(b) Source: Loan Performance Data as of January 2008 industry average.

($ in millions)

1Q08

4Q07

1Q07

First lien

27,171

27,749

28,629

Second lien

32,933

32,350

30,560

Total home equity

60,104

60,099

59,189

30+ days past due

as % of loans

1.37

1.32

0.78

NPAs

432

342

235

as % of loans

0.72

0.57

0.40

Net charge-offs

as % of avg

loans

0.47

0.25

0.13

Wachovia second lien home equity loans 

and lines

60+ days past due vs. industry

Second Lien Home Equity Loans

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

1.60%

1.80%

WB Total General Bank (a)

WB Bank Channel

Industry

Second Lien Home Equity Lines

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

1.60%

1.80%

WB Total General Bank (a)

WB Bank Channel

Industry

(a) Excludes Wealth Management and Retail Brokerage home equity loans and lines.

Source: Industry Prime, Alt-A and Subprime delinquency data from LoanPerformance, a unit of First American CoreLogic.

Managed auto portfolio

Managed losses of 2.31% down 5 bps QoQ

30+ days past due of 2.05% vs. industry

forecast of 3.54%

(b)

Managed NPAs as a % of loans of 25 bps;

down 3 bps QoQ

Roll rates declined throughout quarter

Began proactive migration towards prime

credit customer originations in mid-2006

Managed Consumer Auto 30+ Days Past Due

vs. Industry

(a)

Includes NPAs and net charge-offs from securitizations not included in our

reported NPAs and net charge-offs as referenced on page 16.

(b) Source: Moody’s Economy.com; 1Q08 industry average is a forecast.

($ in millions)

1Q08

4Q07

1Q07

Managed auto

26,357

24,672

22,225

NPAs

(a)

as % of loans

0.25

0.28

0.31

Net charge-offs

(a)

151

145

as % of avg

loans

2.31

2.36

1.46

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

WB Balances

WB 30+ days past due

Industry 30+ days past due

Commercial Real Estate

Real Estate Financial Services portfolio

Commercial Real Estate outstandings

(a)

12% driven by the 1Q08 transfer to the

portfolio of $3.5

billion in income producing

loans from held-for-sale

Continued review of REFS residential-

related portfolio in response to continued

housing market deterioration

1Q08 and 4Q07 portfolio reviews included land

and condo loans as well as residential-related

facilities generally > $2 million

NPAs up $795 million; charge-offs of $126

million up $17 million to 110 bps vs. 115

bps in 4Q07

Increases driven largely by residential portfolio

Average maturity of 1.8 years

(a) Includes the Real Estate Financial Services (REFS) portfolio

of $37.3

billion and $10.3 billion in commercial real estate loans held-for-investment

in Investment Banking

($ in millions)

1Q08

4Q07

1Q07

Residential

12,197

12,437

11,884

Income producing

35,447

30,199

24,437

Total REFS

(a)

47,644

42,636

36,321

Residential NPAs

1,396

919

Income producing NPAs

488

170

Total NPAs

1,884

1,089

as % of loans

3.95

2.55

0.20

Residential c/o

120

Income producing c/o

Total net charge-offs

126

109

as % of avg

loans

1.10

1.15

0.06

Real Estate Financial Services 

Well diversified loan portfolio

$47.6

Billion Commercial Real

Estate Portfolio

(a)

Office

16%

Retail

13%

Multi-Family

12%

Industrial

Income

Producing

Land

Lodging

Other

3.5%

Single

Family

Residential

Improved

Land

Condos

Residential

Unimproved

Land

Non-RE

Collateral

74% income producing

26% residential-related

Average maturity of 1.0 years

Homebuilders -

$4.5B

Regional/small builder portfolio is largely

recourse based with disciplined inventory

controls and 1–2 year terms

Focus on strong sponsorship/management

Land -

$4.8B

Primarily originated with substantial equity

cushion and recourse to borrowers

Condos -

$2.9B

(a) Includes the Real Estate Financial Services portfolio of $37.3 billion and $10.3 billion in commercial real estate loans held-for-investment in Investment Banking

Period-end balance sheet as of 3/31/2008.

3.5%

Mixed

Use

Unsecured

Real Estate

Real Estate Financial Services 

Geographic concentrations

(a)

Includes the Real Estate Financial Services portfolio of $37.3 billion and $10.3 billion in commercial real estate loans held-for-investment in Investment Banking.

(b) Geographic concentration totals do not include $5.9 billion in Commercial Real Estate outstandings related to loans secured by non-real estate collateral and loans with

undefined property locations. International includes Europe and Asia.

Period-end balance sheet as of 3/31/2008.

$47.6

Billion Commercial Real Estate Portfolio

(a)

Top 10 Geographic Concentrations

(b)

California

$4.3

18%

International

$3.5

10%

North

Carolina

$3.1

Texas

$2.9

Virginia

$2.7

Other Remaining

States

$10.4

Georgia

$2.6

Florida

$7.5

24%

New Jersey

$1.7

New York

$1.6

Pennsylvania

$1.4

Middle-market and large corporate

Portfolios much more granular than last

down cycle

Average loan size of $1.5MM

Borrowers well positioned and generally

maintaining higher levels of liquidity

1Q08 commercial net losses of 39 bps

$66 million of losses related to loans backed

by ABS securities in CIB

$119 Billion Commercial

Loan Portfolio

Agriculture/Forestry/

Fishing

22%

Finance

Other

13%

Manufacturing

Mining

11%

Property

Management

Public

Administration

Retail

Trade

Services

17%

Transportation/

Public Util

Building Contractors

Individuals

NEC/

Nonclass

Insurance

Wholesale

Trade

Period-end balance sheet as of 3/31/2008.

Summary and Outlook

Expect 2Q08 net interest income to grow by approximately 5 -

7% over 1Q08 and

then grow modestly over remaining period of 2008

Sources of growth to include:

Modest loan growth from 1Q08 levels

Continued deposit growth including growth in FDIC sweep deposits

Benefit of capital raise and lower dividend rate

Fees remain exposed to net market disruption losses/gains

No share repurchases in the rest of 2008

Targeted capital raise of approximately $7 billion

Tax rate of 28.5 -

29%

Appendix

Consumer real estate portfolio

FICO scores and LTVs at origination.

(a) Second lien LTVs reflect total amount borrowed, including first lien positions held by third parties. LTV data assumes that home equity lines are fully funded.

% Loans

1Q08

Average

LTV

($ in millions)

Balances

FICO

LTV

(a)

> 90%

(a)

Home equity loans and lines

First lien

27,171

729

Second lien

32,933

724

Total home equity loans and lines

60,104

726

Total mortgage

170,093

690

Total consumer real estate portolio

230,197

699

Nonaccrual loans

First lien

5,015

647

Second lien

691

Total consumer real estate nonaccrual loans

5,090

647

0.0%

2.0%

4.0%

6.0%

8.0%

Wachovia Mortgage 

90+ days past due by vintage vs. industry

0.0%

2.0%

4.0%

6.0%

8.0%

2007 -

$33.4 billion Pick-a-Pay / $10.8 billion Traditional

0.0%

2.0%

4.0%

6.0%

8.0%

0.0%

2.0%

4.0%

6.0%

8.0%

Source: Industry Prime, Alt-A, Subprime and NegAm ARM delinquency data from LoanPerformance,

a unit of First American CoreLogic.

Month

2006 -

$32.9 billion Pick-a-Pay / $8.5 billion Traditional

2004 -

$12.0 billion Pick-a-Pay / $4.8 billion Traditional

2005 -

$25.0 billion Pick-a-Pay / $13.9 billion Traditional

WB Traditional

Pick-a-Pay

Industry Prime

Industry Alt-A

Industry Subprime

Industry Prime ARM NegAm

Consumer Real Estate

FICO scores and LTV stratification

Original

FICO

<=60

61-70

71-80

81-90

91-100

100+

Total

Balance

<620

11%

21%

25,160

620-659

14%

21%

26,002

660-699

15%

23%

27,627

>700

21%

35%

42,372

15%

22%

60%

100%

121,161

<620

1,120

620-659

3,471

660-699

16%

7,887

>700

19%

13%

35%

74%

36,454

24%

17%

48%

100%

48,932

<620

634

620-659

2,473

660-699

17%

4,738

>700

20%

14%

22%

71%

19,326

25%

11%

19%

31%

13%

100%

27,171

<620

844

620-659

2,843

660-699

17%

5,667

>700

11%

16%

28%

72%

23,580

15%

12%

22%

38%

14%

100%

32,933

18%

47%

11%

100%

230,197

RE Total

Total

Original CLTV

Total

The

percentages

the

table

above

may

not

add

the

totals

due

rounding.

Consumer Real Estate FICO scores and LTV 

stratification Prior to 2004 and 2005 

vintages

Original

FICO

<=80

81-90

91-100

100+

Total

Balance

<=80

81-90

91-100

100+

Total

Balance

<620

17%

4,257

17%

18%

4,376

620-659

19%

4,846

20%

5,111

660-699

24%

5,997

24%

25%

6,127

>700

39%

40%

9,930

37%

38%

9,372

99%

100%

25,031

100%

24,986

<620

296

147

620-659

843

812

660-699

15%

17%

2,031

15%

16%

2,239

>700

68%

73%

8,560

72%

77%

10,750

90%

100%

11,731

93%

100%

13,948

<620

370

620-659

11%

1,262

393

660-699

10%

21%

2,343

17%

889

>700

38%

20%

65%

7,415

40%

25%

73%

3,781

55%

32%

12%

100%

11,390

54%

34%

12%

100%

5,149

<620

242

145

620-659

11%

865

533

660-699

22%

1,734

18%

1,216

>700

28%

26%

11%

64%

5,157

33%

31%

72%

4,970

43%

38%

18%

100%

7,998

47%

41%

12%

100%

6,864

79%

14%

100%

55,897

86%

10%

100%

50,853

RE Total

Total

2004 and Prior

2005

Original CLTV

The

percentages

the

table

above

may

not

add

the

totals

due

rounding.

Consumer Real Estate FICO scores and LTV 

stratification 2006 and 2007 vintages

Original

FICO

<=80

81-90

91-100

100+

Total

Balance

<=80

81-90

91-100

100+

Total

Balance

<620

25%

8,329

22%

7,346

620-659

22%

7,357

22%

7,474

660-699

21%

6,950

21%

22%

7,343

>700

30%

31%

10,230

32%

34%

11,261

98%

100%

32,866

96%

100%

33,424

<620

255

358

620-659

651

956

660-699

14%

16%

1,392

13%

16%

1,768

>700

65%

73%

6,242

60%

72%

7,750

87%

100%

8,541

82%

12%

100%

10,834

<620

620-659

390

382

660-699

17%

751

13%

632

>700

37%

26%

11%

73%

3,321

46%

21%

76%

3,578

49%

34%

17%

100%

4,539

57%

28%

15%

100%

4,682

<620

203

234

620-659

673

726

660-699

16%

1,312

15%

1,310

>700

36%

29%

73%

5,875

40%

26%

74%

6,488

50%

38%

12%

100%

8,062

53%

34%

13%

100%

8,757

85%

10%

100%

54,247

84%

11%

100%

57,866

RE Total

Total

2006

2007

Original CLTV

The

percentages

the

table

above

may

not

add

the

totals

due

rounding.

Consumer Real Estate FICO scores and LTV 

stratification 2008 and Total

Original

FICO

<=80

81-90

91-100

100+

Total

Balance

<=80

81-90

91-100

100+

Total

Balance

<620

11%

12%

563

21%

25,160

620-659

21%

22%

1,073

21%

26,002

660-699

26%

27%

1,297

22%

23%

27,627

>700

38%

40%

1,922

34%

35%

42,372

96%

100%

4,855

98%

100%

121,161

<620

1,120

620-659

205

3,471

660-699

11%

12%

474

14%

16%

7,887

>700

76%

81%

3,141

67%

74%

36,454

93%

100%

3,878

89%

100%

48,932

<620

634

620-659

2,473

660-699

10%

143

17%

4,738

>700

73%

10%

84%

1,192

42%

22%

71%

19,326

85%

13%

100%

1,411

56%

31%

13%

100%

27,171

<620

844

620-659

2,843

660-699

13%

157

17%

5,667

>700

46%

29%

79%

993

35%

28%

72%

23,580

56%

37%

100%

1,252

49%

38%

14%

100%

32,933

89%

100%

11,333

84%

11%

100%

230,197

RE Total

Total

2008

Total

Original CLTV

The

percentages

the

table

above

may

not

add

the

totals

due

rounding.

1Q08

Pick-a-Pay mortgage nonperforming loans

($ in millions)

Total $4,386

Cumulative charge-offs to date of

$187 million (17% of orig. balance)

No charge-offs to date

Initial charge-offs taken at 180 days

past due as necessary

20%

18%

62%

90 -179 Days

Past Due

(a) LTV is considered to be over 100% if the loan balance exceeds current estimated appraised value less estimated selling costs.

180+ Days Past Due

Updated

(a)

LTV

100%

180+ Days Past Due

Updated

(a)

LTV > 100%

Pick-a-Pay reserve model

Our use of OFHEO in reserve modeling

Office of Federal Housing Enterprise Oversight (OFHEO) is a widely recognized source of

data that measures average price changes in home sales financed by conventional

mortgages, purchased by Fannie Mae or Freddie Mac, and therefore

the data excludes

information on home sales financed by jumbo loans.

We utilize the OFHEO data set as the basis for our allowance modeling for our Pick-a-Pay

portfolio because we believe the data most closely represents the geographic diversity and

granularity, the lower average loan size and the higher average owner equity of this portfolio.

OFHEO’s data set is very robust, granular and covers a long time series which we believe is a

critical foundation for any modeling exercise. Our historical data and model correlations have

been calibrated to the sensitivities of the OFHEO index.

Cautionary statement

The foregoing materials and management’s discussion of them may contain, among other things, certain forward-looking statements with respect to Wachovia,

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 regarding certain of Wachovia’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 Wachovia’s

credit quality trends, (ii) statements relating to the benefits of the merger between Wachovia and A.G. Edwards, Inc. completed on October 1, 2007 (the “A.G.

Edwards Merger”), including future financial and operating results, cost savings, enhanced revenues and the accretion/dilution to reported earnings that may be

realized

from

the

A.G.

Edwards

Merger,

(iii)

statements

relating

the

benefits

the

merger

between

Wachovia

and

Golden

West

Financial

Corporation

completed on October 1, 2006 (the “Golden West Merger”), including future financial and operating results, cost savings, enhanced revenues and the

accretion/dilution to reported earnings that may be realized from the Golden West Merger, and (iv) statements preceded by, followed by or that include the words

“may”,

“could”,

“should”,

“would”,

“believe”,

“anticipate”,

“estimate”,

“expect”,

“intend”,

“plan”,

“projects”,

“outlook”

similar

expressions.

These

forward-looking

statements are based on the current beliefs and expectations of Wachovia’s management and are subject to significant risks and uncertainties that are subject to

change based on various factors (many of which are beyond Wachovia’s control). Actual results may differ from those set forth in the forward-looking

statements.

The

following

factors,

among

others,

could

cause

Wachovia’s

financial

performance

differ

materially

from

that

expressed

such

forward-looking

statements: (1) the risk that the applicable businesses in connection with the A.G. Edwards Merger or the Golden West Merger will not be integrated successfully

or such integrations may be more difficult, time-consuming or costly than expected; (2) the risk that expected revenue synergies and cost savings from the A.G.

Edwards

Merger

the

Golden

West

Merger

may

not

fully

realized

within

the

expected

time

frame;

(3)

the

risk

that

revenues

following

the

A.G.

Edwards Merger or the Golden West Merger may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption following

the

A.G.

Edwards

Merger

the

Golden

West

Merger,

including,

without

limitation,

difficulties

maintaining

relationships

with

employees,

may

greater

than

expected; (5) the risk that the strength of the United States economy in general and the strength of the local economies in which Wachovia conducts operations

may

different

than

expected

resulting

in,

among

other

things,

deterioration

credit

quality

reduced

demand

for

credit,

including

the

resultant

effect

Wachovia’s loan portfolio and allowance for loan losses; (6) 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; (7) potential or actual litigation; (8) inflation, interest rate, market and monetary fluctuations;

(9)

adverse

conditions

the

stock

market,

the

public

debt

market

and

other

capital

markets

(including

changes

interest

rate

conditions)

and

the

impact

such

conditions

Wachovia’s

brokerage

and

capital

markets

activities;

(10)

unanticipated

regulatory

judicial

proceedings

rulings;

(11)

the

impact

changes

accounting principles; (12) adverse changes in financial performance and/or condition of Wachovia’s borrowers which could impact repayment of such

borrowers’

outstanding loans; and (13) the impact on Wachovia’s businesses, as well as on the risks set forth above, of various domestic or international military

or terrorist activities or conflicts.

Wachovia cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements concerning Wachovia, the A.G.

Edwards Merger or the Golden West 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 does not undertake any obligation to update any forward-looking statement, whether written or oral.

The issuer may file a registration statement (including prospectus) with the SEC for the offering to which this communication relates. Before you invest, you

should read the prospectus in that registration statement, the preliminary prospectus supplement and other documents the issuer has filed with the SEC for more

complete

information

about

the

issuer

and

this

offering.

You

may

get

these

documents

for

free

visiting

EDGAR

the

SEC

Web

site

www.sec.gov.

Alternatively, the issuer will arrange to send you the prospectus after filing if you request it by calling toll-free 1-800-326-5897.

Notes on non-GAAP financial measures

The information contained herein includes certain non-GAAP financial measures.

Please

refer

our

First

Quarter

2008

Quarterly

Earnings

Report

for

additional

information

reconciling

non-GAAP

financial

measures

and

for an important explanation of our use of non-GAAP measures and reconciliation of those non-GAAP measures to GAAP.

Wachovia believes these non-GAAP financial measures provide information useful to investors in understanding the underlying operational

performance of the company, its business and performance trends and facilitates comparisons with the performance of others in the financial

services

industry.

Specifically,

Wachovia

believes

the

exclusion

A.G.

Edwards

(AGE)

and

European

Credit

Management

(ECM)

from

the

key

performance measures of fiduciary and asset management fees and expenses permits evaluation and a comparison of results for

ongoing business operations, and it is on this basis that Wachovia management internally assesses the company’s performance. On page

15,

references

Capital

Management’s

results

excluding

AGE

and

ECM

reflect

the

following

growth

for

the

first

quarter

2008:

Fiduciary and asset management fees

$360 million

Expenses

$572 million

Notes on non-GAAP financial measures

Wachovia also provides certain information regarding its auto loan portfolio on a "managed" basis, which is a non-GAAP financial measure. This

non-GAAP financial measure combines auto loans reported on-balance sheet on a GAAP basis with auto loans that have been securitized and

are off-balance sheet. Management believes that providing information on a "managed" basis is useful to investors in understanding underlying

operational performance, trends, and facilitates comparisons with the performance of others in the financial services industry. On page 27,

references are made regarding the managed auto portfolio which is reconciled as follows for the first quarter of 2008, fourth quarter of 2007 and

first quarter of 2007:

Managed Auto Portfolio

($ in millions)

1Q08

4Q07

1Q07

Managed auto

On-balance sheet

24,349

21,790

18,772

Securitized

2,008

2,882

3,453

Total managed auto

26,357

24,672

22,225

NPAs

On-balance sheet

Securitized

Total NPAs

Net charge-offs

On-balance sheet

145

138

Securitized

Total net charge-offs

151

145

Average loans

On-balance sheet

23,605

21,614

18,596

Securitized

2,532

2,923

3,573

Total average loans

26,137

24,537

22,169

NPAs

as a % of loans

On-balance sheet

0.25

0.29

0.33

Securitized

0.31

0.23

0.21

Total NPAs

as a % of loans

0.25

0.28

0.31

Net charge-offs as a % of average loans

On-balance sheet

2.46

2.55

1.65

Securitized

0.97

0.46

Total net charge-offs as a % of average loans

2.31

2.36

1.46

Managed consumer auto 30+ days past due loans

On-balance sheet

499

667

317

Securitized

Total managed consumer auto 30+ days past due loans

540

718

361

Managed consumer auto 30+ days past due loans as a % of loans

On-balance sheet

2.05

3.06

1.69

Securitized

2.02

1.77

1.27

Total managed consumer auto 30+ days past due loans as a % of loans

2.05

2.91

1.62

LOGO

WACHOVIA FIRST QUARTER 2008

QUARTERLY EARNINGS REPORT

APRIL 14, 2008

TABLE OF CONTENTS


Earnings Summary		1
Other Financial Measures		3
Fee and Other Income		4
Noninterest Expense		6
Balance Sheet		7
Asset Quality		10
Summary Operating Results		15
General Bank		17
Wealth Management		20
Corporate and Investment Bank		21
Capital Management		26
Parent		29
Merger-Related And Restructuring Expenses		30
Explanation Of Our Use Of Certain Non-Gap Financial Measures		31
Reconciliation Of Certain Non-GAAP Financial Measures		32
Cautionary Statement		36

READERS ARE ENCOURAGED TO REFER TO WACHOVIA’S RESULTS FOR THE YEAR ENDED DECEMBER 31, 2007, PRESENTED IN ACCORDANCE WITH U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (“GAAP”), WHICH MAY BE FOUND IN WACHOVIA’S 2007 ANNUAL REPORT ON FORM 10-K.

ALL NARRATIVE COMPARISONS ARE WITH FOURTH QUARTER 2007 UNLESS OTHERWISE NOTED.

THE INFORMATION CONTAINED HEREIN INCLUDES CERTAIN NON-GAAP FINANCIAL MEASURES. PLEASE REFER TO PAGES 31-35 FOR AN IMPORTANT EXPLANATION OF OUR USE OF NON-GAAP MEASURES AND RECONCILIATION OF THOSE NON-GAAP MEASURES TO GAAP.

Wachovia 1Q08 Quarterly Earnings Report

Earnings Summary

Earnings Reconciliation


	2008					2007								1Q08 EPS
	First Quarter					Fourth Quarter		Third Quarter		Second Quarter		First Quarter		vs 4Q07		vs 1Q07
(After-tax in millions, except per share data)	Amount			EPS		Amount	EPS	Amount	EPS	Amount	EPS	Amount	EPS	vs 4Q07		vs 1Q07
Net income (loss) available to common stockholders (GAAP)	$	(393	)	(0.20	)	51	0.03	1,618	0.85	2,341	1.22	2,302	1.20	—	%	—
Discontinued operations, net of income taxes		—		—		142	0.07	88	0.05	—	—	—	—	—		—
Net merger-related and restructuring expenses		123		(0.06	)	108	0.05	22	—	20	0.01	6	—	—		—

Earnings excluding merger-related and restructuring expenses, and discontinued operations	$	(270	)	(0.14	)	301	0.15	1,728	0.90	2,361	1.23	2,308	1.20	—		—

Earnings Summary


	2008			2007						1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions, except per share data)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Net interest income (Tax-equivalent)	$	4,805		4,674		4,584		4,487	4,537	3	%	6
Fee and other income		3,091		2,744		2,933		4,240	3,734	13		(17	)

Total revenue (Tax-equivalent)		7,896		7,418		7,517		8,727	8,271	6		(5	)
Provision for credit losses		2,831		1,497		408		179	177	89		—
Other noninterest expense		5,097		5,488		4,397		4,755	4,493	(7	)	13
Merger-related and restructuring expenses		241		187		36		32	10	29		—
Other intangible amortization		103		111		92		103	118	(7	)	(13	)

Total noninterest expense		5,441		5,786		4,525		4,890	4,621	(6	)	18
Minority interest in income of consolidated subsidiaries		155		107		189		139	136	45		14

Income (loss) from continuing operations before income taxes (benefits) (Tax-equivalent)		(531	)	28		2,395		3,519	3,337	—		—
Income taxes (benefits) (Tax-equivalent)		(181	)	(165	)	689		1,178	1,035	10		—

Income (loss) from continuing operations		(350	)	193		1,706		2,341	2,302	—		—
Discontinued operations, net of income taxes		—		(142	)	(88	)	—	—	—		—

Dividends on preferred stock		43		—		—		—	—	—		—
Net income (loss) available to common stockholders	$	(393	)	51		1,618		2,341	2,302	—	%	—

Net interest margin		2.92	%	2.88		2.92		2.96	3.06	—	%	—
Effective tax rate (Tax-equivalent)^{(a) (b)}		34.06		127.17		28.38		33.51	30.99	—		—
Tier 1 capital ratio (c)		7.5		7.4		7.1		7.5	7.4	—		—
Tangible capital ratio (excluding FAS 115/133/158)		3.9		4.2		4.6		4.8	4.7	—		—
Leverage ratio (c)		6.2	%	6.1		6.1		6.2	6.1	—		—
Average diluted common shares (In millions)		1,977		1,983		1,910		1,919	1,925	—	%	3

(a)	1Q08, 4Q07 and 3Q07 include taxes on discontinued operations.

(b)	The tax-equivalent tax rate applies to fully tax-equivalized revenues.

(c)	The first quarter of 2008 is based on estimates.

1Q08 vs. 4Q07

•

Net loss of $350 million; net loss of $393 million, after preferred dividends, down $444 million and down $2.7 billion from 1Q07; net loss per share of $0.20 down $0.23

—

Results reflect a $473 million increase in market disruption-related valuation losses of $2.0 billion and higher credit costs, partially offset by fair value accounting gains and a gain from the Visa IPO

•

Momentum in traditional banking businesses, asset management and retail brokerage masked by effects of credit headwinds and continued market disruption

•

Revenues of $7.9 billion up 6% from 4Q07; down 5% from 1Q07 despite the addition of A.G. Edwards (AGE)

—

Net interest income rose $131 million, or 3%, as the benefits of our liability sensitive rate position, strong earning asset growth of $8.9 billion, improving loan spreads and low-cost core deposit growth were somewhat offset by higher wholesale funding costs and increases in nonaccrual loans

•

Net interest margin increase of 4 bps to 2.92% reflects the benefit of our liability sensitive rate position and improving loan spreads, partially offset by higher wholesale funding including the effects of increased liquidity and rising nonaccrual loans

—

Fee income increased $347 million as $445 million of FAS 157/159 net gains, largely in principal investing, a $225 million gain associated with the Visa IPO and improved advisory and underwriting fees were partially offset by a $523 million increase in market disruption valuation losses and seasonal declines in service charges and commissions despite higher daily volumes; fiduciary and asset management fees, and other banking fees were stable

Page - 1

Wachovia 1Q08 Quarterly Earnings Report

•

Other noninterest expense decreased $391 million, or 7%, largely reflecting lower salaries and benefits expense, despite $109 million in retirement-eligible employee stock compensation expense, as well as lower sundry expense; 1Q08 results included $44 million relating to strategic growth initiatives and $12 million of non-merger related severance costs

•

Average loans up 4% on growth of 6% in commercial and 2% in consumer; up 12% from 1Q07

—

Strength in foreign and commercial real estate including the $3.3 billion average net effect of transfers into the loan portfolio from held-for-sale and large corporate reflecting strong growth and changing market conditions

—

Consumer growth driven by consumer real estate, auto and student

•

Average core deposits increased 1%; up 7% from 1Q07

—

Strong momentum in money market and interest checking reflecting strong sales and a flight to quality, partially offset by declines in CDs and lower DDA balances

•

Provision expense of $2.8 billion increased $1.3 billion largely reflecting increased risk in the consumer real estate, commercial and auto portfolios as well as higher charge-offs

—

Net charge-offs of $765 million, or 66 bps of loans, reflecting higher losses in consumer real estate, commercial and auto

•

Tier 1 capital ratio of 7.5% relatively flat from 4Q07 despite the January 2008 issuance of $3.5 billion of Tier 1 qualifying securities on lower net earnings

Page - 2

Wachovia 1Q08 Quarterly Earnings Report

Other Financial Measures

Performance Highlights


	2008			2007							1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions, except per share data)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Earnings excluding merger-related and restructuring expenses, and discontinued operations (a)(b)
Net income (loss)	$	(270	)	301		1,728		2,361	2,308		—	%	—
Return on average assets		(0.12	)%	0.16		0.94		1.34	1.35		—		—
Return on average common stockholders’ equity		(1.45	)	1.62		9.81		13.66	13.50		—		—
Overhead efficiency ratio (Tax-equivalent)		65.85		75.48		59.73		55.65	55.75		—		—
Overhead efficiency ratio excluding brokerage (Tax-equivalent)		61.92	%	74.54		56.82		52.04	52.60		—		—
Operating leverage (Tax-equivalent)	$	877		(1,208	)	(843	)	210	(51	)	—	%	—

Earnings excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations (a)(b)
Net income (loss)	$	(206	)	366		1,787		2,427	2,384		—	%	—
Dividend payout ratio on common shares		(640.00	)%	355.56		68.09		44.09	45.16		—		—
Return on average tangible assets		(0.09	)	0.20		1.03		1.47	1.49		—		—
Return on average tangible common stockholders’ equity		(2.80	)	5.05		23.88		33.57	33.27		—		—
Overhead efficiency ratio (Tax-equivalent)		64.55		73.97		58.51		54.47	54.33		—		—
Overhead efficiency ratio excluding brokerage (Tax-equivalent)		60.14	%	72.40		55.32		50.61	50.88		—		—
Operating leverage (Tax-equivalent)	$	869		(1,187	)	(855	)	197	(75	)	—	%	—

Other financial data
Net interest margin		2.92	%	2.88		2.92		2.96	3.06		—		—
Fee and other income as % of total revenue		39.15		36.99		39.02		48.58	45.15		—		—
Effective tax rate (c)		40.04		122.05		27.33		32.78	30.22		—		—
Effective tax rate (Tax-equivalent) (c)		34.06	%	127.17		28.38		33.51	30.99		—		—

Asset quality
Allowance for loan losses as % of loans, net		1.37	%	0.98		0.78		0.79	0.80		—		—
Allowance for loan losses as % of nonperforming assets		78		84		115		157	189		—		—
Allowance for credit losses as % of loans, net		1.41		1.02		0.82		0.83	0.84		—		—
Net charge-offs as % of average loans, net		0.66		0.41		0.19		0.14	0.15		—		—
Nonperforming assets as % of loans, net, foreclosed properties and loans held for sale		1.70	%	1.14		0.66		0.49	0.42		—		—

Capital adequacy
Tier 1 capital ratio (d)		7.5	%	7.4		7.1		7.5	7.4		—		—
Tangible capital ratio (including FAS 115/133/158)		3.6		4.0		4.2		4.3	4.4		—		—
Tangible capital ratio (excluding FAS 115/133/158)		3.9		4.2		4.6		4.8	4.7		—		—
Leverage ratio (d)		6.2	%	6.1		6.1		6.2	6.1		—		—

Other
Average diluted common shares (In millions)		1,977		1,983		1,910		1,919	1,925		—	%	3
Actual common shares (In millions) (e)		1,992		1,980		1,901		1,903	1,913		1		4
Dividends paid per common share	$	0.64		0.64		0.64		0.56	0.56		—		14
Book value per common share (e)		36.40		37.66		36.90		36.40	36.47		(3	)	—
Common stock price		27.00		38.03		50.15		51.25	55.05		(29	)	(51	)
Market capitalization (e)	$	53,782		75,302		95,326		97,530	105,330		(29	)	(49	)
Common stock price to book value (e)		74	%	101		136		141	151		(27	)	(51	)
FTE employees		120,378		121,890		109,724		110,493	110,369		(1	)	9
Total financial centers/brokerage offices		4,850		4,894		4,167		4,135	4,167		(1	)	16
ATMs		5,308		5,139		5,123		5,099	5,146		3	%	3

(a)	See tables on page 1, and on pages 32 through 35 for reconciliation to earnings prepared in accordance with GAAP.

(b)	See page 1 for the most directly comparable GAAP financial measure and pages 32 through 35 for reconciliation to earnings prepared in accordance with GAAP.

(c)	The tax-equivalent tax rate applies to fully tax-equivalized revenues.

(d)	The first quarter of 2008 is based on estimates.

(e)	Includes restricted stock for which the holder receives dividends and has full voting rights.

Page - 3

Wachovia 1Q08 Quarterly Earnings Report

Fee and Other Income


	2008			2007						1Q08 Vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter	1Q08 Vs 4Q07		1Q08 vs 1Q07
Service charges	$	676		716		689		667	614	(6	)%	10
Other banking fees		498		497		471		449	416	—		20
Commissions		914		970		600		649	659	(6	)	39
Fiduciary and asset management fees		1,439		1,436		1,029		1,015	953	—		51
Advisory, underwriting and other investment banking fees		261		249		393		454	407	5		(36	)
Trading account profits (losses)		(308	)	(524	)	(301	)	195	128	(41	)	—
Principal investing		446		41		372		298	48	—		—
Securities gains (losses)		(205	)	(320	)	(34	)	23	53	(36	)	—
Other income		(630	)	(321	)	(286	)	490	456	96		—

Total fee and other income	$	3,091		2,744		2,933		4,240	3,734	13	%	(17	)

KEY POINTS

•

Fee and other income of $3.1 billion increased $347 million, or 13%, from 4Q07 and decreased $643 million, or 17%, from 1Q07

—

1Q08 fees improved 13% largely driven by FAS 157/159 net gains, largely in principal investing, the Visa IPO gain, and stable fiduciary and asset management fees and other banking fees, which were more than offset by higher market disruption-related losses, seasonally lower service charges and insurance commissions, as well as modestly lower retail brokerage transaction revenue

(Please see page 5 for additional detail on market disruption-related losses)

—

Declines from 1Q07 reflect market disruption-related valuation losses and lower advisory and underwriting fees which more than offset higher fiduciary and asset management fees and commissions, partially reflecting merger activity, higher principal investing gains, and growth in service charges and interchange fees

•

Service charges declined 6% as seasonally lower consumer service charges more than offset a modest increase in commercial service charges; up 10% from 1Q07 driven by a 12% increase in consumer and 7% increase in commercial

•

Other banking fees were flat as growth in mortgage banking was largely offset by lower letter of credit and interchange fees reflecting seasonality; increased 20% from 1Q07 largely on increases in mortgage banking and interchange fees

•

Commissions declined $56 million, or 6%, on lower brokerage and insurance commissions, including seasonality

•

Fiduciary and asset management fees were relatively flat despite lower valuation levels; results increased $486 million from 1Q07 on the addition of AGE and strength in retail brokerage managed account and other asset-based fees

•

Advisory, underwriting and other investment banking fees increased 5% from depressed 4Q07 levels reflecting increased originations in high grade and equities despite continued weak overall market activity; results decreased 36% from strong 1Q07 levels driven by market disruption

•

Trading account losses of $308 million improved $216 million reflecting $178 million lower market disruption-related valuation losses

•

Principal investing results improved $405 million, and $398 million from 1Q07, driven by FAS 157 net gains of $486 million as well as gains in the direct investment portfolio, partially offset by losses in the public portfolio

•

Securities losses were $205 million in 1Q08 compared to losses of $320 million in 4Q07 and gains of $53 million in 1Q07; 1Q08 results included market disruption-related impairment losses of $480 million compared to $327 million in 4Q07, partially offset by $225 million in gains related to the Visa IPO

Page - 4

Wachovia 1Q08 Quarterly Earnings Report

Other Income


	2008			2007						1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Consumer loan-related sale/ securitization activity	$	13		(115	)	4		45	68	—	%	(81	)
Commercial mortgage-related sale/ securitization activity		(246	)	(365	)	(381	)	142	99	(33	)	—
Other income		(397	)	159		91		303	289	—		—

Total other income (loss)	$	(630	)	(321	)	(286	)	490	456	96	%	—

•

Other income results include:

—

$128 million improvement in consumer loan sales/securitization activity driven by improved consumer real estate and student loan despite $64 million in market disruption losses vs. $59 million in 4Q07

—

$119 million improvement in commercial mortgage-related sales/securitization activity largely reflecting a $124 million reduction in market disruption-related losses

—

Higher market disruption-related losses of $792 million in leveraged finance vs. $87 million in 4Q07

—

No net market disruption-related results on subprime ABS CDO/CLO and other warehouses vs. a net loss of $38 million in 4Q07

—

$39 million increase in results relating to certain corporate investments

Market Disruption-Related Losses, Net


	2008									2007
	First Quarter									2nd Half		Life-To-Date
(Pre-tax dollars in millions)	Trading profits (losses)			Securities gains (losses)		Other Income		Total		Total		Total
Corporate and Investment Bank
ABS CDO and other subprime-related	$	(281	)	(67	)	9		(339	)	(1,048	)	(1,387	)
Commercial mortgage (CMBS)		(283	)	0		(238	)	(521	)	(1,088	)	(1,609	)
Consumer mortgage		(187	)	0		(64	)	(251	)	(205	)	(456	)
Leveraged finance		483		0		(792	)	(309	)	(179	)	(488	)
Other		(131	)	(4	)	(9	)	(144	)	(50	)	(194	)

Total		(399	)	(71	)	(1,094	)	(1,564	)	(2,570	)	(4,134	)
Capital Management
Asset-backed commercial paper		0		0		0		0		(57	)	(57	)
Parent
Securities/Impairment losses		0		(409	)	0		(409	)	(94	)	(503	)

Total, net	$	(399	)	(480	)	(1,094	)	(1,973	)	(3,051	)	(4,694	)

Market Disruption-Related Losses, Net


	2007
	Fourth Quarter
(Pre-tax dollars in millions)	Trading profits (losses)			Securities gains (losses)		Other Income^(a)		Provision		Total
Corporate and Investment Bank
ABS CDO and other subprime-related	$	(517	)	(263	)	(38	)	0		(818	)
Commercial mortgage (CMBS)		(238	)	0		(362	)	0		(600	)
Consumer mortgage		(64	)	0		(59	)	0		(123	)
Leveraged finance		183		(3	)	(87	)	0		93
Other		59		0		0		0		59

Total		(577	)	(266	)	(546	)	0		(1,389	)
Capital Management
Asset-backed commercial paper		0		(17	)	0		0		(17	)
Parent
Securities/Impairment losses		0		(44	)	0		(50	)	(94	)

Total, net		(577	)	(327	)	(546	)	(50	)	(1,500	)
Discontinued operations (BluePoint)	$	(210	)							(210	)

Page - 5

Wachovia 1Q08 Quarterly Earnings Report

Noninterest Expense


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Salaries and employee benefits	$	3,260	3,468	2,628	3,122	2,972	(6	)%	10
Occupancy		379	375	325	331	312	1		21
Equipment		323	334	283	309	307	(3	)	5
Marketing		97	80	74	78	62	21		56
Communications and supplies		186	191	176	178	173	(3	)	8
Professional and consulting fees		196	271	194	205	177	(28	)	11
Sundry expense		656	769	717	532	490	(15	)	34

Other noninterest expense		5,097	5,488	4,397	4,755	4,493	(7	)	13
Merger-related and restructuring expenses		241	187	36	32	10	29		—
Other intangible amortization		103	111	92	103	118	(7	)	(13	)

Total noninterest expense	$	5,441	5,786	4,525	4,890	4,621	(6	)%	18

•

Other noninterest expense decreased $391 million driven by lower salaries and employee benefits, legal costs and professional and consulting fees

—

1Q08 results included $12 million of non-merger severance costs and $44 million associated with growth initiatives including de novo/branch consolidations and Western expansion

•

Salaries and employee benefits expense decreased $208 million driven by a decrease in salaries and incentives, which included lower revenue-based incentives and non-merger severance expense, somewhat offset by $109 million higher retirement-eligible employee stock compensation expense; up 10% from 1Q07 largely due to merger activity

•

Occupancy and equipment expense relatively flat reflecting continued expense discipline; up 13% from 1Q07 largely reflecting merger activity

•

Professional and consulting fees decreased $75 million reflecting seasonally higher expense in 4Q07

•

Sundry expense decreased $113 million, or 15%, driven by lower legal costs

Page - 6

Wachovia 1Q08 Quarterly Earnings Report

Balance Sheet

Average Balance Sheet Data


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Assets
Trading assets	$	44,655	37,694	38,737	35,165	29,681	18	%	50
Securities		110,401	115,436	111,424	108,433	108,071	(4	)	2
Commercial loans, net
General Bank		69,453	67,188	65,776	64,402	62,723	3		11
Corporate and Investment Bank		99,416	91,419	82,934	76,707	73,241	9		36
Other		29,709	29,557	25,962	24,403	21,324	1		39

Total commercial loans, net		198,578	188,164	174,672	165,512	157,288	6		26
Consumer loans, net		267,358	261,641	255,129	255,745	257,973	2		4

Total loans, net		465,936	449,805	429,801	421,257	415,261	4		12

Loans held for sale		11,592	18,998	20,209	17,644	16,748	(39	)	(31	)
Other earning assets (a)		26,449	28,207	28,602	23,479	23,902	(6	)	11

Total earning assets		659,033	650,140	628,773	605,978	593,663	1		11
Cash		11,645	12,028	11,134	11,533	12,260	(3	)	(5	)
Other assets		112,915	101,319	89,097	87,262	85,106	11		33

Total assets	$	783,593	763,487	729,004	704,773	691,029	3	%	13

Liabilities and Stockholders’ Equity
Core interest-bearing deposits	$	338,181	332,148	320,729	316,223	308,294	2	%	10
Foreign and other time deposits		48,840	47,523	37,098	29,922	29,836	3		64

Total interest-bearing deposits		387,021	379,671	357,827	346,145	338,130	2		14
Short-term borrowings		58,538	60,755	65,346	58,020	55,669	(4	)	5
Long-term debt		165,540	158,704	151,226	143,504	141,979	4		17

Total interest-bearing liabilities		611,099	599,130	574,399	547,669	535,778	2		14
Noninterest-bearing deposits		56,332	57,895	58,280	62,273	60,976	(3	)	(8	)
Other liabilities		37,415	32,476	26,468	25,514	24,955	15		50

Total liabilities		704,846	689,501	659,147	635,456	621,709	2		13
Stockholders’ equity		78,747	73,986	69,857	69,317	69,320	6		14

Total liabilities and stockholders’ equity	$	783,593	763,487	729,004	704,773	691,029	3	%	13

(a) Includes interest-bearing bank balances, federal funds sold, securities purchased under resale agreements and margin loans.

Memoranda
Low-cost core deposits	$	270,858	262,982	256,535	257,812	253,008	3	%	7
Other core deposits		123,655	127,061	122,474	120,684	116,262	(3	)	6

Total core deposits	$	394,513	390,043	379,009	378,496	369,270	1	%	7

KEY POINTS

•

Trading assets increased $7.0 billion, or 18%, primarily due to $6.8 billion in securities moved to trading from available for sale concurrent with the election to carry them at fair value under SFAS 159; average VAR of $66 million vs. $44 million in 4Q07

•

Securities decreased $5.0 billion, or 4%, as a $6.8 billion decrease related to securities moved to trading as noted above and $1.5 billion in sales/maturities were partially offset by the $3.2 billion average effect of consumer real estate securitizations; the average duration of the securities portfolio increased to 3.5 years from 3.4 years in 4Q07, driven by increased balances in mortgage-backed securities

•

Commercial loans increased $10.4 billion, or 6%, on higher foreign and commercial real estate, including the $3.2 billion average net effect of $5.0 billion in transfers to the portfolio from held for sale, growth in large corporate loans, higher middle-market and business banking as well as the $219 million average effect of $644 million of leveraged finance loans transferred from held for sale; period-end commercial loans up $13.1 billion

•

Consumer loans increased $5.7 billion, or 2%, reflecting the $1.3 billion average net effect of transfers from held for sale driven by real estate secured and auto, as well as growth in consumer real estate, student and auto, partially offset by the $3.2 billion average effect of consumer real estate sales and securitizations; period-end consumer loans up $5.4 billion with growth in real estate secured, auto and student, partially offset by $2.3 billion of consumer real estate transferred to held for sale at quarter end

•

Loans held for sale declined $7.4 billion as transfers to the portfolio in commercial and consumer real estate and auto, sales activity and lower originations in commercial real estate were somewhat offset by leveraged finance fundings

•

Other earning assets down 6% on wholesale funding changes including lower fed funds sold and interest bearing bank balances

Page - 7

Wachovia 1Q08 Quarterly Earnings Report

•

Total average earning assets rose $8.9 billion, or 1%, and 11% from 1Q07

•

Core deposits increased $4.5 billion, or 1%, reflecting strong momentum in money market, interest checking and brokerage FDIC sweep products due to a flight to quality and including $1.5 billion of FDIC average deposits from AGE, partially offset by declines in CDs and savings products; up 7% from 1Q07

•

Average short-term borrowings decreased $2.2 billion, or 4%, from 4Q07

•

Average long-term debt increased $6.8 billion, or 4%, and increased $23.6 billion from 1Q07

Average Consumer Loans - Total Corporation


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Mortgage	$	52,590	50,480	48,606	46,198	47,736	4	%	10
Pick-a-Payment mortgage		120,963	120,235	118,602	117,673	118,571	1		2
Home equity loans		30,560	31,266	31,334	31,885	31,763	(2	)	(4	)
Home equity lines		27,279	25,912	24,814	26,340	27,839	5		(2	)
Student		9,155	8,073	7,299	8,850	8,524	13		7
Auto and other vehicle		24,554	23,383	22,161	21,016	19,866	5		24
Revolving		1,714	1,670	1,647	3,067	2,858	3		(40	)
Other consumer loans		543	622	666	716	816	(13	)	(33	)

Total consumer loans	$	267,358	261,641	255,129	255,745	257,973	2	%	4

THE FOLLOWING TABLES PROVIDE ADDITIONAL PERIOD-END DETAIL ON OUR BALANCE SHEET.

Period-End Loans Held for Sale


	2008			2007
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Core business activity
Core business activity, beginning of period	$	15,094		17,646		15,696		15,030		12,566
Originations/purchases		8,144		8,160		13,007		22,671		17,873
Transfers to (from) loans held for sale, net		(6,801	)	(1,278	)	2,162		(71	)	(180	)
Allowance for loan losses related to loans		—		—		(57	)	—		—
Lower of cost or market value adjustments ^(a)		(364	)	(223	)	(249	)	(91	)	(3	)
Market value adjustments for FVO loans		42		—		—		—		—
Performing loans sold or securitized		(7,355	)	(8,992	)	(11,606	)	(20,910	)	(14,745	)
Other, principally payments		(354	)	(219	)	(1,307	)	(933	)	(481	)

Core business activity, end of period		8,406		15,094		17,646		15,696		15,030

Portfolio management activity
Portfolio management activity, beginning of period		1,678		3,785		2,037		2		2
Originations/purchases		83		—		—		—		—
Transfers to (from) loans held for sale, net ^(b)		2,317		137		1,831		2,046		—
Lower of cost or market value adjustments ^(a)		(31	)	(30	)	(6	)	(10	)	—
Performing loans sold		(990	)	(2,078	)	—		—		—
Other, principally payments		(34	)	(136	)	(77	)	(1	)	—

Portfolio management activity, end of period		3,023		1,678		3,785		2,037		2

Total loans held for sale ^(c)	$	11,429		16,772		21,431		17,733		15,032

^(a)	Lower of cost or market value adjustments exclude amounts related to unfunded commitments. Market disruption-related write-downs on unfunded commitments amounted to $729 million, $78 million and $311 million in the first quarter of 2008 and in the fourth and third quarters of 2007, respectively.

^(b)	Includes $1.8 billion in third quarter 2007 in connection with the consolidation of a structured lending vehicle; first quarter of 2008 and fourth quarter of 2007 include funding of the structured lending vehicle’s commitments amounting to $54 million and $159 million, respectively.

^(c)	Nonperforming assets included in loans held for sale at March 31, 2008 and at December 31, September 30, June 30 and March 31, 2007, were $5 million, $62 million, $59 million, $42 million and $26 million, respectively.

•

Period-end loans held for sale of $11.4 billion decreased $5.3 billion

—

Loans held for sale related to core business activity decreased $6.7 billion primarily due to lower foreign and commercial real estate, which included a net $957 million of sale and securitization activity and $3.5 billion in transfers to the portfolio; consumer activity included a net $2.7 billion transfer of loans to the portfolio driven by real estate and auto, partially offset by a net $1.3 billion in origination activity; loan syndication positions decreased $469 million

—

In 1Q08, we originated $5.9 billion of consumer mortgages and delivered $5.0 billion to agencies/privates

—

Loans held for sale related to portfolio management activity increased $1.3 billion reflecting net transfers into held for sale of $2.3 billion primarily due to consumer real estate, partially offset by $990 million of commercial sale activity

Page - 8

Wachovia 1Q08 Quarterly Earnings Report

Period-End Managed Portfolio


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Commercial
On-balance sheet loan portfolio	$	221,413	208,351	199,387	185,336	177,075	6	%	25
Securitized loans - off-balance sheet		120	131	142	170	181	(8	)	(34	)
Loans held for sale		3,342	9,414	13,905	11,573	10,467	(64	)	(68	)

Total commercial		224,875	217,896	213,434	197,079	187,723	3		20

Consumer
On-balance sheet loan portfolio		266,958	261,503	257,860	252,067	252,826	2		6
Securitized loans - off-balance sheet		11,399	12,304	13,053	14,122	12,491	(7	)	(9	)
Securitized loans included in securities		11,774	10,854	6,070	6,259	5,807	8		—
Loans held for sale		8,087	7,358	7,526	6,160	4,565	10		77

Total consumer		298,218	292,019	284,509	278,608	275,689	2		8

Total managed portfolio	$	523,093	509,915	497,943	475,687	463,412	3	%	13

•

The third-party consumer mortgage servicing portfolio totaled $38.9 billion at March 31, 2008 and the total consumer mortgage servicing portfolio was $197.3 billion

Period-End Balance Sheet Data


	2008			2007								1Q08		1Q08
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		vs 4Q07		vs 1Q07
Commercial loans, net	$	211,700		198,566		189,545		175,369		167,039		7	%	27
Consumer loans, net		268,782		263,388		259,661		253,751		254,624		2		6

Loans, net		480,482		461,954		449,206		429,120		421,663		4		14

Goodwill and other intangible assets
Goodwill		43,068		43,122		38,848		38,766		38,838		—		11
Deposit base		573		619		670		727		796		(7	)	(28	)
Customer relationships		1,375		1,410		620		651		684		(2	)	—
Tradename		90		90		90		90		90		—		—
Total assets		808,890		782,896		754,168		715,428		702,669		3		15
Core deposits		398,562		397,405		377,865		378,188		377,358		—		6
Total deposits		444,964		449,129		421,937		410,030		405,270		(1	)	10
Long-term debt		175,653		161,007		158,584		142,047		142,334		9		23
Stockholders’ equity	$	78,307		76,872		70,140		69,266		69,786		2	%	12

Memoranda
Unrealized gains (losses) (Before income taxes)
Securities, net	$	(2,340	)	(1,290	)	(1,994	)	(2,768	)	(809	)
Risk management derivative financial instruments, net		1,831		635		(443	)	(1,280	)	(385	)

Unrealized losses, net (Before income taxes)	$	(509	)	(655	)	(2,437	)	(4,048	)	(1,194	)

Page - 9

Wachovia 1Q08 Quarterly Earnings Report

Asset Quality


	2008			2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Nonperforming assets
Nonaccrual loans	$	7,788		4,995	2,715	1,945	1,632	56	%	—
Restructured loans		56		—	—	—	—	—		—
Foreclosed properties		530		389	334	207	155	36		—

Total nonperforming assets	$	8,374		5,384	3,049	2,152	1,787	56	%	—

as % of loans, net and foreclosed properties		1.74	%	1.16	0.68	0.50	0.42	—		—

Nonperforming assets in loans held for sale	$	5		62	59	42	26	(92	)%	(81	)

Total nonperforming assets in loans and in loans held for sale	$	8,379		5,446	3,108	2,194	1,813	54	%	—

as % of loans, net, foreclosed properties and loans held for sale		1.70	%	1.14	0.66	0.49	0.42	—		—

Provision for credit losses	$	2,831		1,497	408	179	177	89		—
Allowance for credit losses	$	6,767		4,717	3,691	3,552	3,533	43	%	92

Allowance for loan losses
as % of loans, net		1.37	%	0.98	0.78	0.79	0.80	—		—
as % of nonaccrual and restructured loans (a)		84		90	129	174	207	—		—
as % of nonperforming assets (a)		78		84	115	157	189	—		—
Allowance for credit losses
as % of loans, net		1.41	%	1.02	0.82	0.83	0.84	—		—

Net charge-offs	$	765		461	206	150	155	66	%	—
Commercial, as % of average commercial loans		0.48	%	0.34	0.08	0.07	0.07	—		—
Consumer, as % of average consumer loans		0.79		0.46	0.27	0.19	0.20	—		—
Total, as % of average loans, net		0.66	%	0.41	0.19	0.14	0.15	—		—

Past due accruing loans, 90 days and over	$	1,047		708	590	562	555	48	%	89
Commercial, as a % of loans, net		0.05	%	0.05	0.04	0.03	0.03	—		—
Consumer, as a % of loans, net		0.35	%	0.23	0.20	0.20	0.20	—		—

(a)	These ratios do not include nonperforming assets included in loans held for sale.

KEY POINTS

•

Total NPAs of $8.4 billion rose $3.0 billion driven by a $1.8 billion increase in consumer real estate and a $691 million increase in commercial real estate; up 58 bps to 1.74% of loans

—

Consumer real estate nonaccrual loan growth reflects the continued deterioration in the housing market, particularly in California and Florida, and includes $632 million in modified loans

—

Commercial real estate nonaccrual loan growth largely relates to residential real estate loans in the Real Estate Financial Services (REFS) portfolio

•

Provision expense of $2.8 billion largely reflecting the effects of continuing significant deterioration in the housing market

—

Results included $2.1 billion of reserve build largely reflecting higher expected losses for the consumer real estate and auto portfolios as well as continued deterioration in estimated default frequency and loss severity in the commercial portfolio

—

Net charge-offs of $765 million, or 66 bps of average loans, increased $304 million driven by higher consumer real estate, commercial and installment losses

•

Allowance for credit losses of $6.8 billion, or 1.41% of net loans

—

Allowance for loan losses covers annualized 1Q08 net charge-offs 2.15 times

—

Allowance reflects higher expected losses across our loan portfolio, particularly in our residential mortgage portfolio, on increased frequency and severity

Page - 10

Wachovia 1Q08 Quarterly Earnings Report

Charge-Offs

Charge-offs


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Loan losses:
Commercial, financial and agricultural	$	(171	)	(67	)	(41	)	(39	)	(34	)	—	%	—
Commercial real estate - construction and mortgage		(81	)	(117	)	(5	)	(4	)	(6	)	(31	)	—

Total commercial		(252	)	(184	)	(46	)	(43	)	(40	)	37		—
Real estate secured		(351	)	(156	)	(59	)	(40	)	(33	)	—		—
Student loans		(3	)	(4	)	(5	)	(2	)	(3	)	(25	)	—
Installment and other loans (a)		(242	)	(225	)	(168	)	(138	)	(142	)	8		70

Total consumer		(596	)	(385	)	(232	)	(180	)	(178	)	55		—

Total loan losses		(848	)	(569	)	(278	)	(223	)	(218	)	49		—
Loan recoveries:
Commercial, financial and agricultural		14		22		9		15		9		(36	)	56
Commercial real estate - construction and mortgage		1		—		3		—		3		—		(67	)

Total commercial		15		22		12		15		12		(32	)	25
Real estate secured		10		9		12		11		6		11		67
Student loans		1		2		3		—		1		(50	)	—
Installment and other loans (a)		57		75		45		47		44		(24	)	30

Total consumer		68		86		60		58		51		(21	)	33

Total loan recoveries		83		108		72		73		63		(23	)	32

Net charge-offs	$	(765	)	(461	)	(206	)	(150	)	(155	)	66	%	—
Net charge-offs as a % of average loans, net (b)
Commercial, financial and agricultural		0.41	%	0.12		0.10		0.07		0.08		—		—
Commercial real estate - construction and mortgage		0.73		1.12		0.02		0.04		0.04		—		—

Total commercial		0.48		0.34		0.08		0.07		0.07		—		—
Real estate secured		0.59		0.26		0.08		0.05		0.05		—		—
Student loans		0.08		0.10		0.14		0.07		0.10		—		—
Installment and other loans (a)		2.76		2.35		1.99		1.47		1.67		—		—

Total consumer		0.79		0.46		0.27		0.19		0.20		—		—

Total, as % of average loans, net		0.66	%	0.41		0.19		0.14		0.15		—		—

Consumer real estate secured net charge-offs:
First lien	$	(291	)	(122	)	(32	)	(17	)	(15	)	—	%	—
Second lien		(50	)	(25	)	(15	)	(12	)	(12	)	—		—

Total consumer real estate secured net charge-offs	$	(341	)	(147	)	(47	)	(29	)	(27	)	—	%	—

(a)	Principally auto loans.

(b)	Annualized.

•

Net charge-offs in the loan portfolio of $765 million increased $304 million, or 66%, driven by growth in consumer real estate, commercial and auto; annualized net charge-offs up 25 basis points to 0.66% of average loans

—

Commercial net charge-offs of $237 million increased $75 million, or 29 bps, to 0.41% of loans

•

Commercial net charge-offs of $157 million increased $112 million driven in part by a $66 million loss associated with a loan that financed the sale of $255 million of residential subprime mortgage assets

•

Commercial real estate net charge-offs of $80 million, or 0.73% of loans, declined $37 million on lower income producing losses

—

Consumer net charge-offs of $528 million increased $229 million, or 33 bps to 0.79%, driven by a $194 million increase in consumer real estate net charge-offs and $35 million higher installment loan losses

•

1Q08 results include $341 million in consumer real estate losses, including $240 million in the Pick-a-Payment portfolio, $29 million in traditional mortgage and $73 million in home equity

•

Installment loan net charge-offs of $185 million were driven by auto losses of $145 million and consumer DDA overdraft losses of $23 million

Page - 11

Wachovia 1Q08 Quarterly Earnings Report

Allowance For Credit Losses

Allowance for Credit Losses


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Allowance for credit losses (a)
Allowance for loan losses, beginning of period	$	4,507		3,505		3,390		3,378		3,360		29	%	34
Net charge-offs		(765	)	(461	)	(206	)	(150	)	(155	)	66		—
Allowance relating to loans acquired, transferred to loans held for sale or sold		(16	)	(10	)	(63	)	(10	)	(3	)	60		—
Provision for credit losses related to loans transferred to loans held for sale or sold (b)		7		6		3		4		1		17		—
Provision for credit losses		2,834		1,467		381		168		175		93		—

Allowance for loan losses, end of period		6,567		4,507		3,505		3,390		3,378		46		94

Reserve for unfunded lending commitments, beginning of period		210		186		162		155		154		13		36
Provision for credit losses		(10	)	24		24		7		1		—		—

Reserve for unfunded lending commitments, end of period		200		210		186		162		155		(5	)	29

Allowance for credit losses	$	6,767		4,717		3,691		3,552		3,533		43	%	92

Allowance for loan losses
as % of loans, net		1.37	%	0.98		0.78		0.79		0.80		—		—
as % of nonaccrual and restructured loans (c)		84		90		129		174		207		—		—
as % of nonperforming assets (c)		78		84		115		157		189		—		—
Allowance for credit losses
as % of loans, net		1.41	%	1.02		0.82		0.83		0.84		—		—

(a)	The allowance for credit losses is the sum of the allowance for loan losses and the reserve for unfunded lending commitments.

(b)	The provision related to loans transferred or sold includes recovery of lower of cost or market losses.

(c)	These ratios do not include nonperforming assets included in loans held for sale.

•

Allowance for credit losses increased $2.1 billion to $6.8 billion, reflecting increased risk in the consumer real estate, commercial and auto portfolios largely resulting from a more uncertain credit environment following a dramatic downturn in the residential housing market, as well as continued loan growth

—

$1.6 billion of the increase related to consumer

•

$1.5 billion reflects an increase in our expected loss factors on our consumer real estate portfolios driven by continued market weakness in certain geographic regions, particularly California and Florida

•

$1.1 billion associated with the Pick-a-Payment portfolio to 155 bps of loans compared to 66 bps at the end of 4Q07

•

$242 million of the increase related to our home equity portfolio to 79 bps of loans

•

$114 million of the increase related to auto, largely reflecting higher expected losses to 321 bps of loans

—

$253 million of the increase related to commercial

•

$144 million reflects an increase in FAS 114 reserves and $109 million relates to higher expected losses on performing loans given the continued economic weakness in large part influenced by the impact of the downturn in the housing market on related commercial sectors

—

$165 million of the increase related to growth in unallocated reserves due to increased credit risk uncertainty stemming from economic and other environmental factors

—

As a percentage of loans, the allowance for loan losses of 1.37% and the allowance for credit losses of 1.41% both rose 39 bps

Page - 12

Wachovia 1Q08 Quarterly Earnings Report

Allowance for Credit Losses


	2008				2007
	First Quarter				Fourth Quarter				Third Quarter
(In millions)	Amount		As a % of loans, net		Amount		As a % of loans, net		Amount		As a % of loans, net
Allowance for loan losses
Commercial	$	2,645	1.25	%	$	2,392	1.20	%	$	2,054	1.08	%
Consumer		3,592	1.34			1,950	0.74			1,246	0.48
Unallocated		330	—			165	—			205	—

Total		6,567	1.37			4,507	0.98			3,505	0.78
Reserve for unfunded lending commitments
Commercial		200	—			210	—			186	—

Allowance for credit losses	$	6,767	1.41	%	$	4,717	1.02	%	$	3,691	0.82	%

Memoranda
Total commercial (Including reserve for unfunded lending commitments)	$	2,845	1.34	%	$	2,602	1.31	%	$	2,240	1.18	%

Nonperforming Assets


	2008			2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Nonaccrual Loans
Commercial:
Commercial, financial and agricultural	$	908		602	354	318	303	51	%	—
Commercial real estate - construction and mortgage		1,750		1,059	289	161	117	65		—

Total commercial		2,658		1,661	643	479	420	60		—

Consumer:
Real estate secured:
First lien		5,015		3,234	2,012	1,381	1,120	55		—
Second lien		75		58	41	43	37	29		—
Installment and other loans (a)		40		42	45	42	51	(5	)	(22	)

Total consumer		5,130		3,334	2,098	1,466	1,208	54		—

Total nonaccrual loans		7,788		4,995	2,715	1,945	1,632	56		—

Restructured loans		56		—	—	—	—	—		—

Foreclosed properties (b)		530		389	334	207	155	36		—

Total nonperforming assets	$	8,374		5,384	3,049	2,152	1,787	56		—
As % of loans, net, and foreclosed properties (c)		1.74	%	1.16	0.68	0.50	0.42	—		—

Nonperforming assets included in loans held for sale
Commercial	$	—		—	—	—	1	—		—
Consumer		5		62	50	37	23	(92	)	(78	)

Total nonperforming assets included in loans held for sale		5		62	59	42	26	(92	)	(81	)

Nonperforming assets included in loans and in loans held for sale	$	8,379		5,446	3,108	2,194	1,813	54		—
As % of loans, net, foreclosed properties and loans held for sale (d)		1.70	%	1.14	0.66	0.49	0.42	—		—

Past due loans, 90 days and over, and nonaccrual loans
Accruing loans past due 90 days and over	$	1,047		708	590	562	555	48		89
Nonaccrual loans		7,788		4,995	2,715	1,945	1,632	56		—

Total past due loans 90 days and over, and nonaccrual loans	$	8,835		5,703	3,305	2,507	2,187	55	%	—
Commercial, as a % of loans, net		1.31	%	0.89	0.38	0.31	0.28	—		—
Consumer, as a % of loans, net		2.26	%	1.49	1.00	0.78	0.68	—		—

(a)	Principally auto loans; nonaccrual status does not apply to student loans.

(b)	Restructured loans are not significant.

(c)	These ratios do not include nonperforming assets included in loans held for sale.

(d)	These ratios reflect nonperforming assets included in loans held for sale.

•

Nonperforming loans in the loan portfolio of $7.8 billion increased $2.8 billion driven by growth in consumer and commercial real estate

—

Commercial nonaccruals of $2.7 billion rose $1.0 billion driven by a $691 million increase in commercial real estate

•

Commercial real estate nonaccruals of $1.8 billion included $615 million in new REFS portfolio inflows following the 4Q07 and 1Q08 reviews of all land and condominium loans as well as residential-related loans with an average loan balance in excess of $2 million; $477 million of this increase related to the residential portion of the REFS portfolio

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Wachovia 1Q08 Quarterly Earnings Report

•

Commercial, financial and agricultural nonaccruals of $908 million rose $306 million

—

Consumer nonaccruals of $5.2 billion increased $1.9 billion largely on consumer real estate and included $1.4 billion from the Pick-a-Payment portfolio

•

1Q08 results include $632 million of Pick-a-Payment modified loans vs. $286 million in 4Q07

•

$253 million of the increase reflects non-branch originated Alt-A loans in the Corporate and Investment Bank transferred at market value from held-for-sale to the portfolio

•

1Q08 period-end average LTV of the consumer real estate nonaccrual loan portfolio of 75% based on values at origination and only 3% of nonaccrual loans were originated with an LTV of 90% or higher

•

$75 million, or 1.5%, of consumer real estate nonaccrual loans secured by a second lien

•

Foreclosed properties of $530 million increased $141 million driven by consumer real estate

—

Pick-a-Payment foreclosed properties increased $67 million to $237 million, up 282 properties to 917

•

During the quarter 825 properties were sold compared with 1,107 new properties reflecting our strategy of aggressive resolution of problem assets

Nonperforming Loans (a)


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Balance, beginning of period	$	4,995		2,715		1,945		1,632		1,234		84	%	305

Commercial nonaccrual loan activity
Commercial nonaccrual loans, beginning of period		1,661		643		479		420		319		—		—
New nonaccrual loans and advances		1,421		1,303		298		205		196		9		—
Charge-offs		(252	)	(184	)	(46	)	(43	)	(40	)	37		—
Transfers (to) from other real estate owned		(26	)	—		(5	)	(2	)	—		—		—
Sales		(33	)	(26	)	(14	)	(15	)	(1	)	27		—
Other, principally payments		(113	)	(75	)	(69	)	(86	)	(54	)	51		—

Net commercial nonaccrual loan activity		997		1,018		164		59		101		(2	)	—

Commercial nonaccrual loans, end of period		2,658		1,661		643		479		420		60		—

Consumer nonaccrual loan activity
Consumer nonaccrual loans, beginning of period		3,334		2,072		1,466		1,212		915		61		—
Transfer (to) from loans held for sale		100		—		—		—		—		—		—
Restructured loans (TDR)		56		—		—		—		—		—		—
Nonaccrual loans sold or securitized		—		—		—		(3	)	—		—		—
Other, net		1,696		1,262		606		257		297		—		—

Net consumer nonaccrual loan activity		1,852		1,262		606		254		297		47		—

Consumer nonaccrual loans, end of period		5,186		3,334		2,072		1,466		1,212		56		—

Balance, end of period	$	7,844		4,995		2,715		1,945		1,632		57	%	—

(a)	Nonperforming assets included in loans held for sale at March 31, 2008 and at December 31, September 30, June 30 and March 31, 2007, were $5 million, $62 million, $59 million, $42 million and $26 million, respectively.

Page - 14

Wachovia 1Q08 Quarterly Earnings Report

SUMMARY OPERATING RESULTS

BUSINESS SEGMENTS

Business segment results are presented excluding (i) merger-related and restructuring expenses, (ii) deposit base intangible and other intangible amortization expense, (iii) amounts presented as discontinued operations, and (iv) the cumulative effect of a change in accounting principles. This is the basis on which we manage and allocate capital to our business segments. We continuously assess assumptions, methodologies and reporting classifications to better reflect the true economics of our business segments and the management of our businesses.

A provision for credit losses is allocated to each core business segment based on net charge-offs, and the difference between the total for each segment and the consolidated provision for credit losses is recorded in the Parent segment.

In order to remove interest rate risk from each core business segment, the management reporting model employs a funds transfer pricing (FTP) system. The FTP system matches the duration of the funding used by each segment to the duration of the assets and liabilities contained in each segment. Matching the duration, or the effective term until an instrument is expected to reprice or mature, allocates interest income and/or interest expense to each segment to insulate its resulting net interest income from interest rate risk.

In a falling rate environment, we experience a tightening spread between deposit costs and wholesale funding costs. However, our FTP system passes the effect of this tightening to deposit-providing business units on a lagged basis. Additionally, the effect of the FTP system is a decrease in charges to business units for funding to support predominantly floating-rate assets. The impact of lower rates earned on floating-rate assets and lagging rates on longer duration deposits is captured in the central money book in the Parent. Interest rate risk at Wachovia is actively managed at the corporate level and is unaffected by volatility in the central money book that may arise as a result of our FTP methodology.

ADOPTION OF NEW ACCOUNTING STANDARDS

On January 1, 2008, we adopted Statement of Financial Accounting Standards (SFAS) No. 157, “Fair Value Measurements,” and SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities.” SFAS 157 establishes a framework for measuring fair value under U.S. GAAP, expands disclosures about fair value measurements and provides new income recognition criteria for certain derivative contracts. SFAS 157 does not establish any new fair value measurements; rather it defines “fair value” for other accounting standards that require the use of fair value for recognition or disclosure. SFAS 159 permits companies to elect to carry certain financial instruments at fair value with corresponding changes in fair value recorded in the results of operations. The effect of adopting SFAS 157 is recorded either directly to first quarter 2008 results of operations or as a cumulative effect of a change in accounting principle through an adjustment to beginning retained earnings on January 1, 2008, depending on the nature of the fair value adjustment. The transition adjustment for SFAS 159 is recorded as a cumulative effect of a change in accounting principle through an adjustment to beginning retained earnings on January 1, 2008.

The adoption of SFAS 157 resulted in net gains in the first quarter 2008 results of operations of $517 million pre-tax related primarily to a change in the methodology used to calculate the fair value of certain investments in private equity funds held in a wholly-owned investment company. Also, on January 1, 2008, we recorded a $38 million after-tax gain ($61 million pre-tax) as a cumulative effect adjustment to beginning retained earnings related to removal of blockage discounts previously applied in determining the fair value of certain actively traded public equity investments and to profits previously deferred on certain derivative transactions. SFAS 157 prohibits the use of blockage discounts in determining the fair value of financial instruments.

Upon adoption of SFAS 159, we elected to record certain existing securities available for sale and a small percentage of our loans held-for-sale portfolio at fair value, and in connection therewith recorded a $38 million after-tax ($60 million pre-tax) charge to 2008 beginning retained earnings as a cumulative effect of the adoption of SFAS 159. During first quarter 2008, we elected fair value for certain newly originated retail mortgage loans held for sale, resulting in gains of $42 million in results of operations. Securities elected upon adoption and their related interest-rate hedges resulted in a net $114 million charge to results of operations. Prospectively, we plan to elect fair value for certain newly originated loans and loans held for sale, certain purchased securities and certain debt issuances with related unrealized gains and losses reported in the results of operations.

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Wachovia 1Q08 Quarterly Earnings Report

To summarize, the total impact of adoption of SFAS 157 was a net gain of $517 million, and the total impact of adoption of SFAS 159 was a net charge of $72 million, for a total net gain of $445 million in results of operations.

On January 1, 2008, we adopted two EITF issues relating to the accounting for split-dollar life insurance policies that we hold on certain current and former employees. The impact of adoption of these standards amounted to a $19 million after-tax reduction in beginning retained earnings.

INVESTMENT IN BLUEPOINT

Wachovia controls 100% of the outstanding equity of BluePoint Re Limited (“BluePoint”), a Bermuda-based monoline bond reinsurer, and accordingly consolidates this subsidiary. BluePoint management is pursuing a restructuring strategy that, if completed, would lead to a significant reduction in Wachovia’s ownership interest in BluePoint and result in de-consolidation of BluePoint in Wachovia’s financial statements.

Management currently expects that a resolution with respect to BluePoint will be effected by September 30, 2008. Accordingly, the results for the third and fourth quarters of 2007 have been reclassified to reflect the results of BluePoint as a discontinued operation. Results from inception of BluePoint in 2005 through the third quarter of 2007 were not material, and accordingly, have not been included in discontinued operations.

In 2007, BluePoint recorded significant losses on ABS CDO certain derivative instruments (principally, credit default swaps on ABS CDOs) and these losses through December 31, 2007, approximated substantially all of Wachovia’s investment in BluePoint and were included in Wachovia’s 2007 consolidated financial results. Wachovia has no further obligation to inject capital in BluePoint. BluePoint continued to record these instruments at fair value in the first quarter of 2008. In estimating the fair value of these instruments under SFAS 157, a company must consider, among other things, its own credit rating, which in this case is BluePoint’s. As Wachovia has no obligation to fund losses in excess of BluePoint’s equity, BluePoint assessed the discount required in valuing these instruments to reflect a market participant’s view of BluePoint’s non-performance risk. BluePoint’s valuation at March 31, 2008, reflected a very significant discount for its non-performance risk, such that BluePoint recorded no further loss on the derivative instruments in the quarter. Accordingly, our first quarter 2008 consolidated results reflect no additional losses in discontinued operations.

GOODWILL

We test goodwill for impairment on an annual basis, or more often if events or circumstances indicate there may be impairment. If the carrying amount of a reporting unit’s goodwill exceeds its implied fair value, we would recognize an impairment loss in an amount equal to that excess. A reporting unit is our sub-segment level.

Historically, we determined fair values of reporting units using two methods, one based on market earnings multiples of peer companies for each reporting unit, and the other based on discounted cash flow models with estimated cash flows based on internal forecasts of revenues and expenses. In the first quarter of 2008, we added a third method, one based on the previously described market earnings multiples of peer companies adjusted to include a control premium calculated based on comparable transactions for each reporting unit. The earnings multiples for the first method ranged between 8.7 times and 17.2 times. The estimated cash flows for the second method used market-based discount rates ranging from 12.4 percent to 17.8 percent. The earnings multiple method adjusted for a control premium ranged from 11.8 times to 23.7 times. These three methods provide a range of valuations we use in evaluating goodwill for possible impairment. Also, we stress the results of each of our three testing methods by 20% to identify areas where additional investigation or procedures may be necessary to complete our analysis.

Our goodwill impairment testing indicated that none of our goodwill is impaired at March 31, 2008. However, as a result of the market disruption, the impact of which is demonstrated by the further spread between our market capitalization and our book value, the excess of the fair value over the carrying value of several of our reporting units continues to narrow. A prolonged period of market disruption, or further market deterioration, may result in the impairment of our goodwill in the future.

Page - 16

Wachovia 1Q08 Quarterly Earnings Report

GENERAL BANK

This segment includes Retail and Small Business, and Commercial.

General Bank

Performance Summary


	2008			2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	3,455		3,402	3,464	3,371	3,398	2	%	2
Fee and other income		990		929	935	936	845	7		17
Intersegment revenue		55		58	58	56	47	(5	)	17

Total revenue (Tax-equivalent)		4,500		4,389	4,457	4,363	4,290	3		5
Provision for credit losses		569		320	207	154	147	78		—
Noninterest expense		2,050		2,041	1,897	1,926	1,869	—		10
Income taxes (Tax-equivalent)		686		741	859	833	830	(7	)	(17	)

Segment earnings	$	1,195		1,287	1,494	1,450	1,444	(7	)%	(17	)

Performance and other data
Economic profit	$	997		1,041	1,188	1,122	1,123	(4	)%	(11	)
Risk adjusted return on capital (RAROC)		42.58	%	47.92	54.29	52.57	53.73	—		—
Economic capital, average	$	12,695		11,179	10,894	10,819	10,662	14		19
Cash overhead efficiency ratio (Tax-equivalent)		45.55	%	46.50	42.57	44.14	43.56	—		—
Lending commitments	$	132,165		133,024	132,778	129,850	124,253	(1	)	6
Average loans, net		311,447		303,269	294,579	291,493	288,229	3		8
Average core deposits	$	297,680		296,568	290,377	290,591	284,046	—		5
FTE employees		54,847		55,579	56,538	57,595	56,722	(1	)%	(3	)

General Bank Key Metrics


	2008	2007				1Q08 vs 4Q07		1Q08 vs 1Q07
	First Quarter	Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Customer overall satisfaction score (a)	6.62	6.62	6.63	6.65	6.63	—	%	—
New/Lost ratio	1.27	1.33	1.34	1.29	1.26	(5	)	1
Online active customers (In thousands) (b)	4,849	4,677	4,491	4,322	4,102	4		18
Financial centers	3,323	3,355	3,381	3,361	3,399	(1	)%	(2	)

(a)	Gallup survey measured on a 1-7 scale; 6.4 = “best in class”.

(b)	Retail and small business.

SEGMENT EARNINGS OF $1.2 BILLION, DOWN 7% AND 17% FROM 1Q07

•

Revenue of $4.5 billion increased 3% and 5% from 1Q07

—

Net interest income rose $53 million, or 2%, as 3% loan and low-cost core deposit growth more than offset the effect of rising nonperforming assets and lower deposit spreads

—

Strong fee growth of 7% reflected improved mortgage banking on improved securitization spreads and higher marketable volumes, partially offset by seasonally lower consumer service charges; fees were up 17% from 1Q07 on strong consumer service charge growth and robust interchange income on higher volumes

•

Provision expense increased $249 million to $569 million driven by higher losses in consumer real estate

•

Expenses were relatively flat, reflecting strong core expense discipline, despite strategic investment, as well as higher loss mitigation and real estate owned (REO) expense

—

Includes $30 million in retirement-eligible stock compensation expense

—

Reflects strategic investment spend of $42 million including $19 million of de novo and branch consolidation costs and $23 million relating to the Western expansion

•

Average loans grew 3% and 8% from 1Q07

—

Consumer loans increased $5.9 billion, or 3%, driven by growth in consumer real estate, student and auto

—

Commercial loans up $2.3 billion, or 3%, driven by growth in middle-market and business banking

•

Average core deposits were relatively stable as strong momentum in money market and interest checking reflecting strong sales and a flight to quality were partially offset by declines in CDs and lower DDA balances

—

Retail net new checking account sales of 174,000 compared with 94,000 in 4Q07

•

422,000 Way2Save accounts opened to date and include 139,000 linked to new checking accounts

Page - 17

Wachovia 1Q08 Quarterly Earnings Report

•

Opened 23 de novo branches during the quarter; including 5 branches in California; consolidated 58 branches

RETAIL AND SMALL BUSINESS

This sub-segment includes Retail Banking, Small Business Banking, Wachovia Mortgage, Wachovia Home Equity, Wachovia Education Finance and other retail businesses.

Retail and Small Business

Performance Summary


	2008			2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	2,513		2,471	2,563	2,506	2,562	2	%	(2	)
Fee and other income		850		812	821	826	736	5		15
Intersegment revenue		12		15	14	14	11	(20	)	9

Total revenue (Tax-equivalent)		3,375		3,298	3,398	3,346	3,309	2		2
Provision for credit losses		395		142	86	58	50	—		—
Noninterest expense		1,640		1,652	1,551	1,573	1,510	(1	)	9
Income taxes (Tax-equivalent)		489		549	643	625	639	(11	)	(23	)

Segment earnings	$	851		955	1,118	1,090	1,110	(11	)%	(23	)


Performance and other data
Economic profit	$	785		800	933	892	910	(2	)%	(14	)
Risk adjusted return on capital (RAROC)		52.08	%	57.36	66.25	64.31	65.96	—		—
Economic capital, average	$	7,680		6,847	6,699	6,710	6,718	12		14
Cash overhead efficiency ratio (Tax-equivalent)		48.60	%	50.07	45.67	46.98	45.65	—		—
Average loans, net	$	226,607		221,180	214,442	213,331	212,314	2		7
Average core deposits	$	249,967		250,207	247,625	247,526	240,524	—	%	4

GENERAL BANK- RETAIL AND SMALL BUSINESS LOAN PRODUCTION

Retail and Small Business


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Loan production
Mortgage	$	12,787	12,419	13,983	15,943	14,425	3	%	(11	)
Home equity		4,837	6,122	7,315	9,044	8,137	(21	)	(41	)
Student		1,431	733	1,346	645	1,155	95		24
Installment		86	127	158	201	175	(32	)	(51	)
Other retail and small business		1,034	1,168	1,356	1,529	1,429	(11	)	(28	)

Total loan production	$	20,175	20,569	24,158	27,362	25,321	(2	)%	(20	)

WACHOVIA.COM

Wachovia.com


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In thousands)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Online product and service enrollments
Retail		13,844	13,272	12,664	11,997	11,517	4	%	20
Wholesale		857	821	781	748	723	4		19

Total online product and service enrollments		14,701	14,093	13,445	12,745	12,240	4		20
Enrollments per quarter		835	823	878	767	796	1		5

Dollar value of transactions (In billions)	$	79.6	67.3	62.4	57.5	47.3	18	%	68

Page - 18

Wachovia 1Q08 Quarterly Earnings Report

COMMERCIAL

This sub-segment includes Business Banking, Middle-Market Commercial and Government Banking.

Commercial

Performance Summary


	2008			2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	942		931	901	865	836	1	%	13
Fee and other income		140		117	114	110	109	20		28
Intersegment revenue		43		43	44	42	36	—		19

Total revenue (Tax-equivalent)		1,125		1,091	1,059	1,017	981	3		15
Provision for credit losses		174		178	121	96	97	(2	)	79
Noninterest expense		410		389	346	353	359	5		14
Income taxes (Tax-equivalent)		197		192	216	208	191	3		3

Segment earnings	$	344		332	376	360	334	4	%	3


Performance and other data
Economic profit	$	212		241	255	230	213	(12	)%	—
Risk adjusted return on capital (RAROC)		28.02	%	33.00	35.19	33.42	32.90	—		—
Economic capital, average	$	5,015		4,332	4,195	4,109	3,944	16		27
Cash overhead efficiency ratio (Tax-equivalent)		36.41	%	35.71	32.63	34.78	36.55	—		—
Average loans, net	$	84,840		82,089	80,137	78,162	75,915	3		12
Average core deposits	$	47,713		46,361	42,752	43,065	43,522	3	%	10

Page - 19

Wachovia 1Q08 Quarterly Earnings Report

WEALTH MANAGEMENT

This segment includes Private Banking, Personal Trust, Investment Advisory Services, Charitable Services, Financial Planning and Insurance Brokerage (property and casualty, and high net worth life).

Wealth Management

Performance Summary


	2008			2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	181		183	185	182	181	(1	)%	—
Fee and other income		211		214	185	202	196	(1	)	8
Intersegment revenue		5		3	4	3	3	67		67

Total revenue (Tax-equivalent)		397		400	374	387	380	(1	)	4
Provision for credit losses		5		7	6	2	1	—		—
Noninterest expense		246		249	240	244	247	(1	)	—
Income taxes (Tax-equivalent)		54		53	47	51	48	2		13

Segment earnings	$	92		91	81	90	84	1	%	10

Performance and other data
Economic profit	$	70		73	62	70	63	(4	)%	11
Risk adjusted return on capital (RAROC)		50.80	%	58.23	50.85	56.74	54.31	—		—
Economic capital, average	$	705		616	616	613	592	14		19
Cash overhead efficiency ratio (Tax-equivalent)		62.08	%	62.27	64.36	62.74	65.12	—		—
Lending commitments	$	7,007		7,011	7,007	6,892	6,686	—		5
Average loans, net		22,413		21,791	21,564	21,127	20,394	3		10
Average core deposits	$	17,397		16,773	16,935	17,342	17,267	4		1
FTE employees		4,650		4,712	4,547	4,580	4,589	(1	)%	1

Wealth Management Key Metrics


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Assets under management (a)	$	79,834	83,933	82,801	79,329	76,214	(5	)	5
Wealth Management producers		970	985	969	981	949	(2	)%	2

(a)	Includes $39 billion in assets managed by and reported in Capital Management.

SEGMENT EARNINGS OF $92 MILLION, UP 1% AND 10% FROM 1Q07

•

Revenue of $397 million decreased 1%, up 4% from 1Q07

—

Net interest income declined 1% as tighter spreads more than offset strong growth in average loans and core deposits

—

Fee and other income decreased 1% as record fiduciary and asset management fees were more than offset by lower insurance commissions on continued market weakness

—

Fiduciary and asset management fees included a $12 million increase related to a receivables adjustment driven in part by 2007 pricing increases which more than offset declines in equity valuations

•

Expenses decreased 1% as efficiency initiatives and lower severance expense more than offset $8 million in retirement eligible employee stock compensation expense

•

Average loans grew 3% and 10% from 1Q07, led by commercial lending

•

Assets under management decreased 5% from 4Q07 due to market performance; up 5% vs. 1Q07 as asset gathering overcame market depreciation

Page - 20

Wachovia 1Q08 Quarterly Earnings Report

CORPORATE AND INVESTMENT BANK

This segment includes Corporate Lending, Investment Banking, and Treasury and International Trade Finance.

Corporate and Investment Bank

Performance Summary


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	1,032		988		838		774		716		4	%	44
Fee and other income		(159	)	(555	)	175		1,522		1,109		(71	)	—
Intersegment revenue		(50	)	(50	)	(52	)	(50	)	(43	)	—		16

Total revenue (Tax-equivalent)		823		383		961		2,246		1,782		—		(54	)
Provision for credit losses		197		112		1		(2	)	6		76		—
Noninterest expense		747		952		626		1,020		911		(22	)	(18	)
Income taxes (benefits) (Tax-equivalent)		(44	)	(250	)	123		449		315		(82	)	—

Segment earnings (loss)	$	(77	)	(431	)	211		779		550		(82	)%	—

Performance and other data
Economic profit (loss)	$	(411	)	(746	)	(114	)	490		286		(45	)%	—
Risk adjusted return on capital (RAROC)		(1.49	)%	(15.18	)	6.36		33.22		24.91		—		—
Economic capital, average	$	13,242		11,293		9,794		8,852		8,329		17		59
Cash overhead efficiency ratio (Tax-equivalent)		90.76	%	247.83		65.23		45.43		51.10		—		—
Lending commitments	$	113,521		118,127		119,295		114,971		110,214		(4	)	3
Average loans, net		101,024		91,702		83,002		76,779		73,385		10		38
Average core deposits	$	33,623		36,200		37,177		36,702		34,227		(7	)	(2	)
FTE employees		6,358		6,589		6,719		6,860		6,650		(4	)%	(4	)

SEGMENT LOSS OF $77 MILLION, IMPROVED $354 MILLION; DOWN $627 MILLION FROM 1Q07

•

Revenue of $823 million increased $440 million and decreased $959 million from 1Q07

—

Results reflect the continued effect of the market disruption with valuation losses of $1.6 billion somewhat offset by $539 million of net gains related to FAS 157/159 fair value accounting adoption, largely in principal investing

—

Net interest income increased $44 million, or 4%, largely reflecting higher trading related income in global rate products and equities as well as increased loan outstandings in structured products and corporate lending

•

Average loans rose 10% led by 4Q07 and 1Q08 transfers of commercial and residential real estate and leveraged finance loans from held for sale to the portfolio as well as growth in corporate lending; up 38% from 1Q07

—

Fee and other income increased $396 million driven by principal investing largely reflecting the adoption of the new accounting standard on fair value, improved advisory and underwriting fees and service charges, partially offset by $175 million higher market disruption-related losses and reduced origination volume across most investment banking areas; down $1.3 billion from 1Q07

(Please see page 22 for additional detail on market disruption-related losses)

•

Principal investing gains of $447 million increased $405 million from 4Q07 and included $486 million in fair value accounting adjustments, partially offset by mark-to-market losses in the direct investment portfolio

•

Securities losses of $66 million improved $194 million from losses of $260 million in 4Q07 due to lower market disruption-related losses in structured products

•

Trading account losses of $247 million improved $298 million from losses of $545 million largely reflecting lower net market disruption-related valuation losses of $399 million vs. $577 million in 4Q07

•

Advisory and underwriting revenue of $308 million increased $7 million from 4Q07 reflecting increased originations in high grade and equities despite the continued negative impact of the credit market disruption on investment banking activity

•

Other income decreased $495 million to a net loss of $889 million on a $548 million increase in market disruption-related losses, largely in leveraged finance, partially offset by lower write-downs in structured products as well as reduced lower of cost or market valuation losses on loans held for sale

Page - 21

Wachovia 1Q08 Quarterly Earnings Report

•

Provision expense increased $85 million largely driven by higher losses in residential-related commercial real estate as well as increased losses in commercial loans collateralized by residential mortgage asset-backed securities

•

Expenses decreased $205 million, or 22%, driven by lower salaries and incentives despite $15 million in retirement-eligible employee stock compensation expense; down 18% from 1Q07

•

Net market disruption-related valuation losses were $1.6 billion and reflected higher leveraged finance and consumer mortgage-related losses, partially offset by decreased marks in structured product warehouses (CDO/CLO and other structured products) and commercial mortgage

Market Disruption-Related Losses, Net


	2008									2007
	First Quarter									2nd Half
(Pre-tax dollars in millions)	Trading profits (losses)			Securities gains (losses)		Other Income		Total		Trading profits (losses)		Securities gains (losses)		Other Income		Total
Corporate and Investment Bank
ABS CDO and other subprime-related	$	(281	)	(67	)	9		(339	)	(747	)	(263	)	(38	)	(1,048	)
Commercial mortgage (CMBS)		(283	)	0		(238	)	(521	)	(367	)	0		(721	)	(1,088	)
Consumer mortgage		(187	)	0		(64	)	(251	)	(105	)	0		(100	)	(205	)
Leveraged finance		483		0		(792	)	(309	)	245		(3	)	(421	)	(179	)
Other		(131	)	(4	)	(9	)	(144	)	(50	)	0		0		(50	)

Total	$	(399	)	(71	)	(1,094	)	(1,564	)	(1,024	)	(266	)	(1,280	)	(2,570	)

Page - 22

Wachovia 1Q08 Quarterly Earnings Report

CORPORATE LENDING

This sub-segment includes Large Corporate Lending, Leasing and Real Estate Financial Services.

Corporate Lending

Performance Summary


	2008			2007					1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter	Third Quarter	Second Quarter		First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	432		418	413	406		400	3	%	8
Fee and other income		154		148	135	140		125	4		23
Intersegment revenue		13		18	16	19		18	(28	)	(28	)

Total revenue (Tax-equivalent)		599		584	564	565		543	3		10
Provision for credit losses		132		103	2	(1	)	5	28		—
Noninterest expense		141		137	139	148		152	3		(7	)
Income taxes (Tax-equivalent)		119		126	153	152		142	(6	)	(16	)

Segment earnings	$	207		218	270	266		244	(5	)%	(15	)

Performance and other data
Economic profit	$	46		65	82	98		89	(29	)%	(48	)
Risk adjusted return on capital (RAROC)		13.77	%	15.37	17.15	19.22		18.81	—		—
Economic capital, average	$	6,634		5,929	5,273	4,784		4,619	12		44
Cash overhead efficiency ratio (Tax-equivalent)		23.55	%	23.46	24.58	26.19		28.08	—		—
Average loans, net	$	64,161		62,473	58,663	56,186		55,193	3		16
Average core deposits	$	4,537		4,606	5,101	5,067		5,083	(1	)%	(11	)

Corporate Lending

Loans Outstanding


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Large corporate loans	$	16,972	15,915	14,318	13,348	14,068	7	%	21
Real estate financial services		37,054	36,220	34,384	33,377	32,455	2		14
Capital finance		10,135	10,338	9,961	9,461	8,670	(2	)	17

Total loans outstanding	$	64,161	62,473	58,663	56,186	55,193	3	%	16

Page - 23

Wachovia 1Q08 Quarterly Earnings Report

INVESTMENT BANKING

This sub-segment includes Equity Capital Markets, M&A, Fixed Income Division, Loan Syndications and Principal Investing.

Investment Banking

Performance Summary


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	488		460		321		268		225		6	%	—
Fee and other income		(532	)	(922	)	(180	)	1,169		775		(42	)	—
Intersegment revenue		(16	)	(21	)	(22	)	(20	)	(16	)	(24	)	—

Total revenue (Tax-equivalent)		(60	)	(483	)	119		1,417		984		(88	)	—
Provision for credit losses		67		9		—		(1	)	1		—		—
Noninterest expense		431		641		317		700		586		(33	)	(26	)
Income taxes (benefits) (Tax-equivalent)		(204	)	(415	)	(70	)	264		143		(51	)	—

Segment earnings (loss)	$	(354	)	(718	)	(128	)	454		254		(51	)%	—

Performance and other data
Economic profit	$	(513	)	(867	)	(254	)	344		156		(41	)%	—
Risk adjusted return on capital (RAROC)		(22.17	)%	(57.68	)	(13.11	)	48.03		29.66		—		—
Economic capital, average	$	6,225		5,009		4,179		3,733		3,376		24		84
Cash overhead efficiency ratio (Tax-equivalent)		(719.88	)%	(133.14	)	270.51		49.44		59.46		—		—
Average loans, net	$	23,402		16,920		13,526		11,053		9,923		38		—
Average core deposits	$	9,463		10,764		10,854		10,544		9,236		(12	)%	2

Investment Banking


	2008			2007						1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Total revenue
Fixed income global rate products	$	135		91		135		150	125	48	%	8
Fixed income credit products (Excluding loan portfolio)		246		166		201		215	208	48		18
Fixed income structured products/other		527		441		471		588	457	20		15
Market disruption losses		(1,564	)	(1,389	)	(1,181	)	—	—	13		—

Total fixed income		(656	)	(691	)	(374	)	953	790	(5	)	—
Principal investing		414		23		361		300	43	—		—
Total equities/M&A/other		182		185		132		164	151	—		21

Total revenue		(60	)	(483	)	119		1,417	984	(88	)	—

Trading-related revenue
Net interest income (Tax-equivalent)		147		115		34		43	42	28		—
Trading account profits (losses)		(246	)	(564	)	(383	)	191	115	(56	)	—
Other fee income		188		180		141		160	128	4		47

Total net trading-related revenue (Tax-equivalent)		89		(269	)	(208	)	394	285	—		(69	)

Principal investing balances
Direct investments		1,636		1,554		1,534		1,197	1,029	5		59
Fund investments		1,052		789		776		779	805	33		31

Total principal investing balances	$	2,688		2,343		2,310		1,976	1,834	15	%	47

Investment Banking


	2008			2007						1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Total revenue
Investment banking (a)	$	401		400		422		482	443	—	%	(9	)
Capital markets (b)		(875	)	(906	)	(664	)	635	498	(3	)	—
Principal investing		414		23		361		300	43	—		—

Total revenue	$	(60	)	(483	)	119		1,417	984	(88	)%	—

(a)	Activities relating to corporate customers.

(b)	Activities relating to institutional clients.

Page - 24

Wachovia 1Q08 Quarterly Earnings Report

TREASURY AND INTERNATIONAL TRADE FINANCE

This sub-segment includes Treasury Services, International Correspondent Banking and Trade Finance.

Treasury and International Trade Finance

Performance Summary


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	112		110		104		100		91		2	%	23
Fee and other income		219		219		220		213		209		—		5
Intersegment revenue		(47	)	(47	)	(46	)	(49	)	(45	)	—		4

Total revenue (Tax-equivalent)		284		282		278		264		255		1		11
Provision for credit losses		(2	)	—		(1	)	—		—		—		—
Noninterest expense		175		174		170		172		173		1		1
Income taxes (Tax-equivalent)		41		39		40		33		30		5		37

Segment earnings	$	70		69		69		59		52		1	%	35

Performance and other data
Economic profit	$	56		56		58		48		41		—	%	37
Risk adjusted return on capital (RAROC)		70.22	%	74.10		77.79		68.14		61.40		—		—
Economic capital, average	$	383		355		342		335		334		8		15
Cash overhead efficiency ratio (Tax-equivalent)		61.69	%	61.78		60.99		65.13		67.79		—		—
Average loans, net	$	13,461		12,309		10,813		9,540		8,269		9		63
Average core deposits	$	19,623		20,830		21,222		21,091		19,908		(6	)%	(1	)

•

Total treasury services product revenues for the company were $720 million in 1Q08 vs. $737 million in 4Q07 and $680 million in 1Q07

Page - 25

Wachovia 1Q08 Quarterly Earnings Report

CAPITAL MANAGEMENT

This segment includes Asset Management and Retail Brokerage Services.

Capital Management

Performance Summary


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	274		318		268		260		259		(14	)%	6
Fee and other income		2,191		2,211		1,444		1,536		1,477		(1	)	48
Intersegment revenue		(10	)	(11	)	(8	)	(11	)	(8	)	9		(25	)

Total revenue (Tax-equivalent)		2,455		2,518		1,704		1,785		1,728		(3	)	42
Provision for credit losses		—		—		—		—		—		—		—
Noninterest expense		1,855		1,938		1,241		1,294		1,237		(4	)	50
Income taxes (Tax-equivalent)		219		212		169		179		179		3		22

Segment earnings	$	381		368		294		312		312		4	%	22

Performance and other data
Economic profit	$	322		309		258		275		275		4	%	17
Risk adjusted return on capital (RAROC)		71.51	%	68.92		88.96		92.77		94.78		—		—
Economic capital, average	$	2,143		2,120		1,310		1,348		1,334		1		61
Cash overhead efficiency ratio (Tax-equivalent)		75.54	%	76.96		72.82		72.47		71.59		—		—
Lending commitments	$	1,348		1,281		1,164		1,169		961		5		40
Average loans, net		2,562		2,295		2,142		1,663		1,554		12		65
Average core deposits	$	43,084		38,019		31,489		31,221		31,683		13		36
FTE employees		29,838		29,885		17,908		17,905		17,703		—	%	69

Capital Management Key Metrics


	2008		2007				1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in billions)	First Quarter		Fourth Quarter	Third Quarter	Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Equity assets	$	74.1	83.7	84.7	85.3	107.1	(11	)%	(31	)
Fixed income assets		117.8	122.9	137.6	135.1	143.2	(4	)	(18	)
Money market assets		66.8	68.1	63.1	61.1	64.3	(2	)	4

Total assets under management (a)		258.7	274.7	285.4	281.5	314.6	(6	)	(18	)

Gross fluctuating mutual fund sales	$	2.6	2.5	2.0	2.7	3.7	4		(30	)

Full-service financial advisors series 7		14,583	14,607	8,391	8,303	8,166	—		79
Financial center advisors series 6		4,059	3,296	2,996	2,531	2,521	23		61
Broker client assets	$	1,118.5	1,170.4	807.2	795.8	773.0	(4	)	45
Customer receivables including margin loans	$	6.3	6.4	4.7	4.8	4.7	(2	)	34
Traditional brokerage offices		1,527	1,539	786	774	768	(1	)	99
Banking centers with brokerage services		2,569	2,203	2,038	1,834	1,850	17	%	39

(a)	Includes $39 billion in assets managed for Wealth Management, which are also reported in that segment.

SEGMENT EARNINGS OF $381 MILLION, UP 4% AND UP 22% FROM 1Q07 INCLUDING THE EFFECT OF AGE

•

Revenue of $2.5 billion down 3%; up 42% from 1Q07 including $718 million relating to acquisitions

•

Net interest income declined 14% as FDIC deposit growth of $5.0 billion reflecting organic growth including increases from AGE was more than offset by spread compression

•

Fee and other income decreased $20 million, or 1%, on slightly lower retail brokerage commissions and asset management fees reflecting lower valuations partially offset by improvement from lower 4Q07 levels which included a $17 million valuation loss on certain asset-backed commercial paper purchased from Evergreen money market funds in 3Q07; up $714 million, or 48%, from 1Q07

•

Expenses decreased $83 million, or 4%, driven by lower commissions, other incentives and legal costs, partially offset by $30 million in retirement eligible employee stock compensation expense; up 50% from 1Q07 largely reflecting merger activity and legal costs

•

Assets under management decreased 6% largely reflecting lower market valuations

•

Growth in recently hired, high producing brokers offset by lower producing broker attrition

•

Strong growth in Series 6 Financial Advisors throughout footprint, including Western region

•

AGE integration on track

•

Combined broker-dealers

•

Re-branding under way

•

Credit product rollout

Page - 26

Wachovia 1Q08 Quarterly Earnings Report

RETAIL BROKERAGE SERVICES

This sub-segment consists of the retail brokerage, and annuity and reinsurance businesses.

Retail Brokerage Services

Performance Summary


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	268		311		262		254		256		(14	)%	5
Fee and other income		1,898		1,934		1,202		1,227		1,207		(2	)	57
Intersegment revenue		(9	)	(11	)	(7	)	(11	)	(8	)	18		(13	)

Total revenue (Tax-equivalent)		2,157		2,234		1,457		1,470		1,455		(3	)	48
Provision for credit losses		—		—		—		—		—		—		—
Noninterest expense		1,634		1,725		1,038		1,076		1,022		(5	)	60
Income taxes (Tax-equivalent)		191		185		154		143		158		3		21

Segment earnings	$	332		324		265		251		275		2	%	21

Performance and other data
Economic profit	$	279		271		235		219		244		3	%	14
Risk adjusted return on capital (RAROC)		69.23	%	67.17		94.13		88.54		99.04		—		—
Economic capital, average	$	1,929		1,915		1,116		1,133		1,127		1		71
Cash overhead efficiency ratio (Tax-equivalent)		75.74	%	77.15		71.33		73.18		70.22		—		—
Average loans, net	$	2,521		2,273		2,106		1,646		1,521		11		66
Average core deposits	$	42,631		37,614		31,071		30,857		31,405		13	%	36

Retail Brokerage Transaction

The Retail Brokerage Services sub-segment results shown in the above table include 100% of the results of the Wachovia Securities retail brokerage business which is the combination of Wachovia and Prudential’s retail brokerage operations. The combined entity is owned by Wachovia Securities Financial Holdings, LLC (“WSFH”), which is a consolidated subsidiary of Wachovia Corporation for GAAP purposes.

As a result of Wachovia’s contribution to WSFH of the retail securities business of A.G. Edwards on January 1, 2008, Prudential Financial’s percentage interest in WSFH has been diluted as of that date based on the value of the contributed business relative to the value of WSFH. Although the adjustment in Prudential Financial’s interest will be effective as of the January 1, 2008, contribution date, the valuations necessary to calculate the precise reduction in that percentage interest are not yet complete. Based on currently available information, Wachovia estimates that Prudential Financial’s percentage interest will be diluted from its pre-contribution interest of 38% to approximately 23% as a result of the A.G. Edwards contribution.

Prudential Financial’s minority interest is included in minority interest expense reported in the Parent (see page 29) and in Wachovia Corporation’s consolidated statements of income on a GAAP basis, which differs from our segment reporting as noted on page 1. For the three months ended March 31, 2008, Prudential Financial’s pre-tax minority interest on a GAAP basis was $48 million. This amount may be adjusted higher or lower in a subsequent quarter if the final valuations differ from Wachovia’s current estimate.

The Retail Brokerage Services sub-segment results reported in the above table also include our Insurance Services business, as well as additional corporate allocations not included in the Wachovia Securities Financial Holdings results.

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Wachovia 1Q08 Quarterly Earnings Report

ASSET MANAGEMENT

This sub-segment consists of the mutual fund business and customized investment advisory services, including retirement services.

Asset Management

Performance Summary


	2008			2007					1Q08 vs 4Q07		1Q08 vs 1Q07
(In millions)	First Quarter			Fourth Quarter	Third Quarter		Second Quarter	First Quarter	1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	6		7	6		5	3	(14	)%	—
Fee and other income		295		279	244		312	272	6		8
Intersegment revenue		(1	)	—	(1	)	—	—	—		—

Total revenue (Tax-equivalent)		300		286	249		317	275	5		9
Provision for credit losses		—		—	—		—	—	—		—
Noninterest expense		224		217	206		222	220	3		2
Income taxes (Tax-equivalent)		28		26	15		35	20	8		40

Segment earnings	$	48		43	28		60	35	12	%	37

Performance and other data
Economic profit	$	42		37	22		55	29	14	%	45
Risk adjusted return on capital (RAROC)		90.31	%	82.68	56.73		112.79	68.24	—		—
Economic capital, average	$	214		205	194		215	207	4		3
Cash overhead efficiency ratio (Tax-equivalent)		74.75	%	76.33	82.50		70.01	80.04	—		—
Average loans, net	$	41		22	36		17	33	86		24
Average core deposits	$	453		405	418		364	278	12	%	63

Capital Management Eliminations

In addition to the above sub-segments, Capital Management results include eliminations among business units. Certain brokerage commissions earned on mutual fund sales by our brokerage sales force are eliminated and deferred in the consolidation of Capital Management reported results. In 1Q08, brokerage revenue and expense eliminations were a reduction of $2 million and $3 million, respectively.

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Wachovia 1Q08 Quarterly Earnings Report

PARENT

This sub-segment includes the central money book, investment portfolio, some consumer real estate and mortgage assets, minority interest in consolidated subsidiaries, the cross-border leveraged lease portfolio, businesses being wound down or divested, other intangible amortization and eliminations.

Parent

Performance Summary


	2008			2007								1Q08 vs 4Q07		1Q08 vs 1Q07
(Dollars in millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter		1Q08 vs 4Q07		1Q08 vs 1Q07
Income statement data
Net interest income (Tax-equivalent)	$	(137	)	(217	)	(171	)	(100	)	(17	)	(37	)%	—
Fee and other income		(142	)	(55	)	194		44		107		—		—
Intersegment revenue		—		—		(2	)	2		1		—		—

Total revenue (Tax-equivalent)		(279	)	(272	)	21		(54	)	91		3		—
Provision for credit losses		2,060		1,058		194		25		23		95		—
Noninterest expense		302		419		485		374		347		(28	)	(13	)
Minority interest		198		118		189		139		136		68		46
Income taxes (benefits) (Tax-equivalent)		(1,021	)	(853	)	(495	)	(322	)	(333	)	20		—
Dividends on preferred shares		43		—		—		—		—		—		—

Segment earnings (loss)	$	(1,818	)	(1,014	)	(352	)	(270	)	(82	)	79	%	—

Performance and other data
Economic profit (loss)	$	(842	)	(338	)	(229	)	(244	)	(61	)	—	%	—
Risk adjusted return on capital (RAROC)		(168.09	)%	(51.89	)	(26.84	)	(29.14	)	1.61		—		—
Economic capital, average	$	1,889		2,143		2,394		2,434		2,658		(12	)	(29	)
Cash overhead efficiency ratio (Tax-equivalent)		(71.99	)%	(113.51	)	1,841.86		(489.55	)	250.80		—		—
Lending commitments	$	538		599		529		569		503		(10	)	7
Average loans, net		28,490		30,748		28,514		30,195		31,699		(7	)	(10	)
Average core deposits	$	2,729		2,483		3,031		2,640		2,047		10		33
FTE employees		24,685		25,125		24,012		23,553		24,705		(2	)%	—

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Wachovia 1Q08 Quarterly Earnings Report

MERGER-RELATED AND RESTRUCTURING EXPENSES


A.G. Edwards Transaction One-time Costs (In millions)	Net Merger- Related and Restructuring Expenses		Exit Cost Purchase Accounting Adjustments^(b)	*Total*
Total estimated costs and expenses^(a)	$	1,204	196	1,400

Actual expenses
First quarter 2008	$	206	35	241
Total 2007		124	43	167

Total actual expenses	$	330	78	408

(a)	Represents the original estimate at the time of the deal announcement.

(b)	These adjustments represent incremental costs related to combining the two companies and are specifically attributable to A.G. Edwards’ business.

Examples include employee termination costs, employee relocation costs, contract cancellations including leases and closing redundant A.G. Edwards acquired facilities.

These adjustments are reflected in goodwill and are not charges against income.


Golden West Transaction One-time Costs (In millions)	Net Merger- Related and Restructuring Expenses		Exit Cost Purchase Accounting Adjustments^(b)	*Total*
Total estimated costs and expenses^(a)	$	288	192	480

Actual expenses
First quarter 2008	$	35	—	35
Total 2007		118	173	291
Total 2006		40	41	81

Total actual expenses	$	193	214	407

(a)	Represents the original estimate at the time of the deal announcement.

(b)	These adjustments represent incremental costs related to combining the two companies and are specifically attributable to Golden West’s business.

Examples include employee termination costs, employee relocation costs, contract cancellations including leases and closing redundant Golden West acquired facilities.

These adjustments are reflected in goodwill and are not charges against income.

Merger-Related and Restructuring Expenses (Income Statement Impact)


	2008			2007
(In millions)	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Total Golden West merger-related and restructuring expenses	$	35		64		32		20		2
Total A.G. Edwards merger-related and restructuring expenses		206		121		3		—		—
Other merger-related and restructuring expenses		—		2		1		12		8

Net merger-related and restructuring expenses		241		187		36		32		10
Minority interest share in merger-related and restructuring expenses		(43	)	(11	)	—		—		—
Income taxes (benefits)		(75	)	(67	)	(15	)	(12	)	(4	)

After-tax net merger-related and restructuring expenses	$	123		109		21		20		6


Goodwill and Other Intangibles Recorded	*2008*			*2007*
in the A.G. Edwards Transaction (In millions)	First Quarter			Fourth Quarter
Purchase price less former A.G. Edwards ending tangible stockholders’ equity as of October 1, 2007	$	4,598		4,600

Fair value purchase accounting adjustments^(a)
Investments		(1	)	(1	)
Restricted stock awards		(14	)	—
CRE		(31	)	—
Other assets		10		8
Deposits, short-term borrowings, long-term debt and other liabilities		(23	)	(27	)
Income taxes		41		11

Total fair value purchase accounting adjustments		(18	)	(9	)

Exit cost purchase accounting adjustments^(b)
Personnel and employee termination benefits		48		22
Other liabilities		8		2
Occupancy and equipment		3		—
Other		19		19

Total pre-tax exit costs		78		43
Income taxes		(24	)	(10	)

Total after-tax exit cost purchase accounting adjustments (One-time costs)		54		33

Total purchase intangibles		4,634		4,624
Customer and other intangibles (Net of income taxes)		513		513

Goodwill, end of period	$	4,121		4,111

(a)	These amounts represent fair value adjustments to adjust assets and liabilities of the former A.G. Edwards to their fair values as of October 1, 2007.

(b)	These adjustments represent incremental costs relating to combining the two companies and are specifically attributable to those businesses of the former A.G. Edwards.

Page - 30

Wachovia 1Q08 Quarterly Earnings Report

EXPLANATION OF OUR USE OF CERTAIN NON-GAAP FINANCIAL MEASUR ES

In addition to results presented in accordance with GAAP, this quarterly earnings report includes certain non-GAAP financial measures, including those presented on pages 1 and 3 under the captions “Earnings Reconciliation”, and “Other Financial Measures”, with the sub-headings – “Earnings excluding merger-related and restructuring expenses” — “Earnings excluding merger-related and restructuring expenses, and discontinued operations” and — “Earnings excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations”, and which are reconciled to GAAP financial measures on pages 32-35. In addition, in this quarterly earnings report certain designated net interest income amounts are presented on a tax-equivalent basis, including the calculation of the overhead efficiency ratio.

Wachovia believes these non-GAAP financial measures provide information useful to investors in understanding the underlying operational performance of the company, its business and performance trends and facilitates comparisons with the performance of others in the financial services industry. Specifically, Wachovia believes the exclusion of merger-related and restructuring expenses and discontinued operations permits evaluation and a comparison of results for on-going business operations, and it is on this basis that Wachovia’s management internally assesses the company’s performance. Those non-operating items are excluded from Wachovia’s segment measures used internally to evaluate segment performance in accordance with GAAP because management does not consider them particularly relevant or useful in evaluating the operating performance of our business segments. In addition, because of the significant amount of deposit base intangible amortization, Wachovia believes the exclusion of this expense provides investors with consistent and meaningful comparisons to other financial services firms. Wachovia’s management makes recommendations to its board of directors about dividend payments based on reported earnings excluding merger-related and restructuring expenses, other intangible amortization, discontinued operations and the cumulative effect of a change in accounting principle, and has communicated certain dividend payout ratio goals to investors on this basis. Management believes this payout ratio is useful to investors because it provides investors with a better understanding of and permits investors to monitor Wachovia’s dividend payout policy. Wachovia also believes the presentation of net interest income on a tax-equivalent basis ensures comparability of net interest income arising from both taxable and tax-exempt sources and is consistent with industry standards. Wachovia operates one of the largest retail brokerage businesses in our industry, and we have presented an overhead efficiency ratio excluding these brokerage services, which management believes is useful to investors in comparing the performance of our banking business with other banking companies.

Although Wachovia believes the above non-GAAP financial measures enhance investors’ understanding of our business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP basis financial measures.

Page - 31

Wachovia 1Q08 Quarterly Earnings Report

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

Reconciliation of Certain Non-GAAP Financial Measures


		2008			2007
(In millions)	*	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Income (loss) from continuing operations
Net income (loss) (GAAP)	A	$	(393	)	51		1,618		2,341		2,302
Discontinued operations, net of income taxes (GAAP)			—		142		88		—		—

Income (loss) from continuing operations (GAAP)			(393	)	193		1,706		2,341		2,302
Merger-related and restructuring expenses (GAAP)			123		108		22		20		6

Income (loss) excluding merger-related and restructuring expenses, and discontinued operations	B		(270	)	301		1,728		2,361		2,308
Other intangible amortization (GAAP)			64		65		59		66		76

Income (loss) excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	C	$	(206	)	366		1,787		2,427		2,384

Income (loss) available to Common Stockholders
Net income (loss) available to common shareholders (GAAP)	D	$	(393	)	51		1,618		2,341		2,302
Discontinued operations, net of income taxes (GAAP)			—		142		88		—		—

Income (loss) from continuing operations available to common stockholders			(393	)	193		1,706		2,341		2,302
Merger-related and restructuring expenses (GAAP)			123		108		22		20		6

Income (loss) excluding merger-related and restructuring expenses, and discontinued operations	E		(270	)	301		1,728		2,361		2,308
Other intangible amortization (GAAP)			64		65		59		66		76

Income (loss) available to common stockholders excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	F	$	(206	)	366		1,787		2,427		2,384

Return on average common stockholders’ equity
Average common stockholders’ equity (GAAP)	G	$	74,697		73,599		69,857		69,317		69,320
Merger-related and restructuring expenses and other (GAAP)			110		100		36		14		1

Average common stockholders’ equity, excluding merger-related and restructuring expenses, and discontinued operations	H		74,807		73,699		69,893		69,331		69,321
Average intangible assets (GAAP)	I		(45,211	)	(44,941	)	(40,198	)	(40,328	)	(40,263	)

Average common stockholders’ equity, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	J	$	29,596		28,758		29,695		29,003		29,058

Return on average common stockholders’ equity
GAAP	D/G		(2.11	)%	0.28		9.19		13.54		13.47
Excluding merger-related and restructuring expenses, and discontinued operations	E/H		(1.45	)	1.62		9.81		13.66		13.50
Return on average tangible common stockholders’ equity
GAAP	D/G+I		(5.36	)	0.71		21.64		32.38		32.14
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	F/J		(2.80	)%	5.05		23.88		33.57		33.27

Table continued on next page.

Page - 32

Wachovia 1Q08 Quarterly Earnings Report

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

Reconciliation of Certain Non-GAAP Financial Measures


		2008			2007
(In millions)	*	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Return on average assets
Average assets (GAAP)	K	$	783,593		763,487		729,004		704,773		691,029
Average intangible assets (GAAP)			(45,211	)	(44,941	)	(40,198	)	(40,328	)	(40,263	)

Average tangible assets (GAAP)	L	$	738,382		718,546		688,806		664,445		650,766

Average assets (GAAP)		$	783,593		763,487		729,004		704,773		691,029
Merger-related and restructuring expenses and other (GAAP)			110		100		36		14		1

Average assets, excluding merger-related and restructuring expenses, and discontinued operations	M		783,703		763,587		729,040		704,787		691,030
Average intangible assets (GAAP)			(45,211	)	(44,941	)	(40,198	)	(40,328	)	(40,263	)

Average tangible assets, excluding merger- related and restructuring expenses, and discontinued operations	N	$	738,492		718,646		688,842		664,459		650,767

Return on average assets
GAAP	A/K		(0.18	)%	0.03		0.88		1.33		1.35
Excluding merger-related and restructuring expenses, and discontinued operations	B/M		(0.12	)	0.16		0.94		1.34		1.35
Return on average tangible assets
GAAP	A/L		(0.19	)	0.03		0.93		1.41		1.43
Excluding merger-related and restructuring expenses, other intangible amoritization and discontinued operations	C/N		(0.09	)%	0.20		1.03		1.47		1.49

*	The letters included in the column are provided to show how the various ratios presented in the tables on pages 32 through 35 are calculated.

For example, return on average assets on a GAAP basis is calculated by dividing net income (GAAP) by average assets (GAAP) (i.e., A/H), and annualized where appropriate.

Table continued on next page.

Page - 33

Wachovia 1Q08 Quarterly Earnings Report

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

Reconciliation of Certain Non-GAAP Financial Measures


		2008			2007
(In millions)	*	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Overhead efficiency ratios
Noninterest expense (GAAP)	O	$	5,441		5,786		4,525		4,890		4,621
Merger-related and restructuring expenses (GAAP)			(241	)	(187	)	(36	)	(32	)	(10	)

Noninterest expense, excluding merger-related and restructuring expenses	P		5,200		5,599		4,489		4,858		4,611
Other intangible amortization (GAAP)			(103	)	(111	)	(92	)	(103	)	(118	)

Noninterest expense, excluding merger-related and restructuring expenses, and other intangible amoritization	Q	$	5,097		5,488		4,397		4,755		4,493

Net interest income (GAAP)		$	4,752		4,630		4,551		4,449		4,500
Tax-equivalent adjustment			53		44		33		38		37

Net interest income (Tax-equivalent)			4,805		4,674		4,584		4,487		4,537
Fee and other income (GAAP)			3,091		2,744		2,933		4,240		3,734

Total	R	$	7,896		7,418		7,517		8,727		8,271

Retail Brokerage Services, excluding insurance
Noninterest expense (GAAP)	S	$	1,628		1,719		1,033		1,070		1,015

Net interest income (GAAP)		$	261		303		255		248		249
Tax-equivalent adjustment			1		1		—		—		—

Net interest income (Tax-equivalent)			262		304		255		248		249
Fee and other income (GAAP)			1,866		1,908		1,180		1,202		1,185

Total	T	$	2,128		2,212		1,435		1,450		1,434

Overhead efficiency ratios
GAAP	O/R		68.91	%	78.00		60.20		56.02		55.88
Excluding merger-related and restructuring expenses	P/R		65.85		75.48		59.73		55.65		55.75
Excluding merger-related and restructuring expenses, and brokerage	P-S/R-T		61.92		74.54		56.82		52.04		52.60
Excluding merger-related and restructuring expenses, and other intangible amoritization	Q/R		64.55		73.97		58.51		54.47		54.33
Excluding merger-related and restructuring expenses, other intangible amoritization and brokerage	Q-S/R-T		60.14	%	72.40		55.32		50.61		50.88

Table continued on next page.

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Wachovia 1Q08 Quarterly Earnings Report

RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

Reconciliation of Certain Non-GAAP Financial Measures


		2008			2007
(In millions, except per share data)	*	First Quarter			Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Operating leverage
Operating leverage (GAAP)		$	823		(1,359	)	(847	)	189		(13	)
Merger-related and restructuring expenses (GAAP)			54		151		4		21		(38	)

Operating leverage, excluding merger-related and restructuring expenses			877		(1,208	)	(843	)	210		(51	)
Other intangible amortization (GAAP)			(8	)	21		(12	)	(13	)	(24	)

Operating leverage, excluding merger-related and restructuring expenses, and other intangible amortization		$	869		(1,187	)	(855	)	197		(75	)

Dividend payout ratios on common shares
Dividends paid per common share	U	$	0.64		0.64		0.64		0.56		0.56

Diluted/Basic earnings per common share (GAAP)	V	$	(0.20	)	0.03		0.85		1.22		1.20
Merger-related and restructuring expenses (GAAP)			0.06		0.05		—		0.01		—
Other intangible amortization (GAAP)			0.04		0.03		0.04		0.04		0.04
Discontinued operations (GAAP)			—		0.07		0.05		—		—

Diluted/Basic earnings per common share, excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	W	$	(0.10	)	0.18		0.94		1.27		1.24

Dividend payout ratios
GAAP	U/V		(320.00	)%	2,133.33		75.29		45.90		46.67
Excluding merger-related and restructuring expenses, other intangible amortization and discontinued operations	U/W		(640.00	)%	355.56		68.09		44.09		45.16

The letters included in the column are provided to show how the various ratios presented in the tables on pages 32 through 35 are calculated. For example, return on average assets on a GAAP basis is calculated by dividing net income (GAAP) by average assets (GAAP) (i.e., A/H), and annualized where appropriate.

Page - 35

Wachovia 1Q08 Quarterly Earnings Report

CAUTIONARY STATEMENT

The foregoing materials and management’s discussion of them may contain, among other things, certain forward-looking statements with respect to Wachovia, 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 regarding certain of Wachovia’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 Wachovia’s credit quality trends, (ii) statements relating to the benefits of the merger between Wachovia and A.G. Edwards, Inc. completed on October 1, 2007 (the “A.G. Edwards Merger”), including future financial and operating results, cost savings, enhanced revenues and the accretion/dilution to reported earnings that may be realized from the A.G. Edwards Merger, (iii) statements relating to the benefits of the merger between Wachovia and Golden West Financial Corporation completed on October 1, 2006 (the “Golden West Merger”), including future financial and operating results, cost savings, enhanced revenues and the accretion/dilution to reported earnings that may be realized from the Golden West Merger, 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 forward-looking statements are based on the current beliefs and expectations of Wachovia’s management and are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond Wachovia’s control). Actual results may differ from those set forth in the forward-looking statements. The following factors, among others, could cause Wachovia’s financial performance to differ materially from that expressed in such forward-looking statements: (1) the risk that the applicable businesses in connection with the A.G. Edwards Merger or the Golden West Merger will not be integrated successfully or such integrations may be more difficult, time-consuming or costly than expected; (2) the risk that expected revenue synergies and cost savings from the A.G. Edwards Merger or the Golden West Merger may not be fully realized or realized within the expected time frame; (3) the risk that revenues following the A.G. Edwards Merger or the Golden West Merger may be lower than expected; (4) deposit attrition, operating costs, customer loss and business disruption following the A.G. Edwards Merger or the Golden West Merger, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the risk that the strength of the United States economy in general and the strength of the local economies in which Wachovia 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 loan portfolio and allowance for loan losses; (6) 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; (7) potential or actual litigation; (8) inflation, interest rate, market and monetary fluctuations; (9) 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 brokerage and capital markets activities; (10) unanticipated regulatory or judicial proceedings or rulings; (11) the impact of changes in accounting principles; (12) adverse changes in financial performance and/or condition of Wachovia’s borrowers which could impact repayment of such borrowers’ outstanding loans; and (13) the impact on Wachovia’s businesses, as well as on the risks set forth above, of various domestic or international military or terrorist activities or conflicts.

Wachovia cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements concerning Wachovia, the A.G. Edwards Merger or the Golden West 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 does not undertake any obligation to update any forward-looking statement, whether written or oral.

The issuer may file a registration statement (including prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement, the preliminary prospectus and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer will arrange to send you the prospectus after filing if you request it by calling toll-free 1-800-326-5897.

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