Compass Bancshares Reports Record Earnings for 2006 up 15%

Compass Bancshares, Inc. (Nasdaq: CBSS) today reported record earnings of $460.4 million for 2006, a 15 percent increase over the $401.8 million earned during 2005. For the same time period, earnings per share increased 11 percent to $3.53 from $3.18 in 2005. Return on average assets and return on average shareholders’ equity for the full-year of 2006 were 1.39 percent and 17.68 percent, respectively. Earnings for the fourth quarter of 2006 increased 16 percent to $118.3 million compared to $102.1 million earned during the fourth quarter of 2005. Earnings per share for the fourth quarter of 2006 increased 11 percent to $0.90 from $0.81 in the prior year. Return on average assets and return on average shareholders’ equity for the fourth quarter of 2006 were 1.38 percent and 16.73 percent, respectively. D. Paul Jones, Jr., Compass chairman and chief executive officer, stated, "2006 was another outstanding year for Compass as we delivered double-digit growth to our shareholders despite a less than favorable interest rate environment. Balance was the key to our success as we achieved solid, top-line revenue growth, robust loan production, steady deposit generation and healthy credit quality metrics. This brings our compound annual growth rate in earnings per share to 11 percent over both five- and 10-year time horizons. Consistent earnings growth is a distinguishing hallmark of our company and, we believe, the best way to create long-term value for our shareholders. It also provides further evidence of our ability to manage during both good and tough economic cycles. While we enter 2007 against a backdrop of considerable economic uncertainty, we continue to believe that Compass’ diversified business mix, expanding distribution network, sales and service culture and market share upside position us well to meet these challenges.” Jones added, "Compass’ record financial performance was fueled by a 12 percent increase in revenue, driven by a 15 percent increase in net interest income. Noninterest income increased eight percent from prior year levels as most of our major fee-based businesses generated solid growth. While noninterest expense increased from prior year levels, a large part of this increase can be attributed to the expansion of our distribution network through the acquisition and integration of TexasBank and its 22 banking centers as well as the 14 new banking centers opened throughout our footprint.” "Compass experienced solid balance sheet growth with average earning assets increasing 12 percent over prior year levels. More importantly, the growth in earning assets was driven by an 18 percent increase in average loans, offset in part by a seven percent decrease in our investment securities portfolio. Average deposits increased 20 percent, led by double-digit increases in interest bearing transaction accounts and time deposits,” Jones stated. "Solid balance sheet growth, coupled with a higher base of low-cost transaction accounts resulted in our percent net interest margin increasing to 3.69 percent from 3.58 percent a year ago. However, the impact of a protracted inverted yield curve and continued pressure from rising funding costs resulted in a fourth quarter net interest margin more consistent with the fourth quarter 2005 levels. Given the uncertainty over interest rates, our focus has remained on generating high-quality loans and growing our base of low-cost transaction account deposits, which resulted in a $146.2 million increase in net interest income.” "Importantly, loan growth did not come at the expense of maintaining sound credit quality standards as both net charge-offs and nonperforming asset ratios continue to perform at historically low-levels. Net charge-offs as a percentage of average loans decreased to 0.32 percent compared to 0.48 percent in 2005. Nonperforming assets as a percentage of loans and other real estate increased slightly to 0.30 percent compared to 0.28 percent at year-end 2005. At the same time, loan loss provision expense exceeded net charge-offs by $12.7 million during the year and our allowance for loan losses as a percentage of loans ended the year at 1.18 percent,” Jones said. Compass operates 415 full-service banking centers including 164 in Texas, 89 in Alabama, 75 in Arizona, 44 in Florida, 33 in Colorado, and 10 in New Mexico. Compass will host a live conference call and webcast at 1:00 p.m. Central Time on January 22. Additional material information, including forward-looking information such as considerations regarding future results, may be discussed during the presentation. To participate by telephone dial 1-888-543-2107, passcode Compass, or by webcast at www.compassbank.com. A copy of the presentation will be made available on our web site prior to the call. A replay of the conference call and webcast will be made available until midnight on January 29, 2007. To access a replay of the conference call dial 1-800-642-1687, conference ID 5634753. Additional information about Compass, a member of the S&P 500 Index and Dow Jones Select Dividend Index, can be found at www.compassbank.com. "Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995 In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Compass Bancshares, Inc. notes that any statements in this press release, and elsewhere, that are not historical facts are "forward-looking statements” that involve risks and uncertainties that may cause the Company’s actual results of operations to differ materially from expected results. For a discussion of such risks and uncertainties, see the Company’s Annual Report on Form 10-K for the most recently ended fiscal year as well as its other filings with the U.S. Securities and Exchange Commission. COMPASS BANCSHARES, INC. (Unaudited) (In thousands except per share data)   Three Months Ended December 31 % 2006  2005  Change EARNINGS SUMMARY Net interest income $ 280,615  $ 253,825  11  Noninterest income [a] 179,509  169,090  6  Total revenue [a] 460,124  422,915  9  Trading settlements on economic hedge swaps -  2,150  (100) Trading losses on economic hedge swaps -  (6,054) (100) Investment securities gains (losses), net -  -  -  Gain on prepayment of FHLB advances 6,191  -  -  Gain on sale of business/branches -  1,600  (100) Provision for loan losses 21,042  35,550  (41) Noninterest expense 273,497  229,940  19  Pretax income 171,776  155,121  11  Income tax expense 53,460  52,983  1  Net income $ 118,316  $ 102,138  16  Diluted earnings per share $ 0.90  $ 0.81  11  Diluted weighted average shares outstanding 132,050  126,188  5      Year Ended December 31 % 2006  2005  Change EARNINGS SUMMARY Net interest income $1,115,134  $ 968,979  15  Noninterest income [a] 705,065  655,443  8  Total revenue [a] 1,820,199  1,624,422  12  Trading settlements on economic hedge swaps -  13,398  (100) Trading losses on economic hedge swaps -  (16,633) (100) Investment securities gains (losses), net (14,889) 79  NM  Gain on prepayment of FHLB advances 21,084  -  -  Gain on sale of business/branches -  6,391  (100) Provision for loan losses 89,702  117,818  (24) Noninterest expense 1,049,275  901,803  16  Pretax income 687,417  608,036  13  Income tax expense 227,054  206,206  10  Net income $ 460,363  $ 401,830  15  Diluted earnings per share $ 3.53  $ 3.18  11  Diluted weighted average shares outstanding 130,458  126,423  3  Three Months Ended December 31     2006  2005  SELECTED RATIOS Average common equity to average assets 8.22  % 7.32  % Average loans to average total deposits 108.19  109.05  Return on average assets 1.38  1.34  Return on average equity 16.73  18.24  Efficiency ratio [b] 56.58  54.57  Return on average tangible equity [c] 23.15  21.94  Book value per common share $ 21.71  $ 18.10  Allowance for loan losses as a % of total loans 1.18  % 1.25  % Allowance for loan losses as a % of nonperforming loans 517.22  553.43    Year Ended December 31   2006  2005  SELECTED RATIOS Average common equity to average assets 7.89  % 7.37  % Average loans to average total deposits 107.17  108.57  Return on average assets 1.39  1.36  Return on average equity 17.68  18.52  Efficiency ratio [b] 56.23  55.39  Return on average tangible equity [c] 24.01  22.39  Book value per common share $ 21.71  $ 18.10  Allowance for loan losses as a % of total loans 1.18  % 1.25  % Allowance for loan losses as a % of nonperforming loans 517.22  553.43    Average for Three Months Ended December 31 % 2006  2005  Change BALANCE SHEET HIGHLIGHTS Total loans $24,785,123  $21,145,075  17  Total loans - managed 25,782,504  22,398,631  15  Total investment securities [d] 6,537,468  6,846,925  (5) Earning assets [d] 31,386,030  28,058,377  12  Total assets 34,128,376  30,352,131  12  Noninterest bearing demand deposits 6,221,719  5,910,240  5  Interest bearing transaction accounts 9,077,514  7,650,828  19  Total transaction accounts 15,299,233  13,561,068  13  Total deposits [d] 22,908,482  19,390,286  18  Shareholders' equity 2,804,989  2,221,018  26      Average for Year Ended December 31 % 2006  2005  Change BALANCE SHEET HIGHLIGHTS Total loans $23,713,038  $20,049,588  18  Total loans - managed 24,808,575  21,448,110  16  Total investment securities [d] 6,567,048  7,031,093  (7) Earning assets [d] 30,353,213  27,142,091  12  Total assets 33,012,350  29,444,232  12  Noninterest bearing demand deposits 6,196,642  5,702,201  9  Interest bearing transaction accounts 8,770,985  7,396,716  19  Total transaction accounts 14,967,627  13,098,917  14  Total deposits [d] 22,126,587  18,467,675  20  Shareholders' equity 2,603,166  2,170,062  20      Ending Balance December 31 % 2006  2005  Change BALANCE SHEET HIGHLIGHTS Total loans $24,665,273  $21,372,215  15  Total loans - managed 25,662,752  22,600,399  14  Total investment securities [d] 6,640,948  6,950,317  (4) Earning assets [d] 31,365,457  28,396,710  10  Total assets 34,199,755  30,798,232  11  Noninterest bearing demand deposits 6,459,669  6,097,881  6  Interest bearing transaction accounts 9,211,360  7,773,212  19  Total transaction accounts 15,671,029  13,871,093  13  Total deposits [d] 23,045,529  20,384,115  13  Shareholders' equity 2,824,134  2,236,029  26  Period-end shares outstanding 130,083  123,539  5      [a] Excludes trading settlements and losses on economic hedge swaps, net gain (loss) on sales of investment securities, gain on prepayment of FHLB advances and gain on sales of business / branches. [b] Ratio is calculated by dividing noninterest expense less merger and integration and operating lease write-down expense by taxable equivalent net interest income plus noninterest income less net gain (loss) on sales of investment securities, gains on sales of business / branches and gain on prepayment of FHLB advances. [c] Excludes amortization of intangibles, net of tax, and intangible assets. [d] Includes adjustment for market valuation. NM - Not meaningful COMPASS BANCSHARES, INC. (Unaudited) (In thousands except per share data)   Three Months Ended 2006  Dec 31 Sep 30 Jun 30 EARNINGS SUMMARY Net interest income $ 280,615  $ 286,576  $ 287,682  Noninterest income [a] 179,509  178,850  181,417  Total revenue [a] 460,124  465,426  469,099  Trading settlements on economic hedge swaps -  -  -  Trading losses on economic hedge swaps -  -  -  Investment securities losses, net -  -  (51) Gain on prepayment of FHLB advances 6,191  -  -  Gain on sale of business/branches -  -  -  Provision for loan losses 21,042  24,226  27,322  Noninterest expense 273,497  265,558  265,850  Pretax income 171,776  175,642  175,876  Income tax expense 53,460  56,875  60,505  Net income $ 118,316  $ 118,767  $ 115,371  Diluted earnings per share $ 0.90  $ 0.90  $ 0.88  Diluted weighted average shares outstanding 132,050  131,799  131,395    Three Months Ended 2006  2005  Mar 31 Dec 31 EARNINGS SUMMARY Net interest income $ 260,261  $ 253,825  Noninterest income [a] 165,289  169,090  Total revenue [a] 425,550  422,915  Trading settlements on economic hedge swaps -  2,150  Trading losses on economic hedge swaps -  (6,054) Investment securities losses, net (14,838) -  Gain on prepayment of FHLB advances 14,893  -  Gain on sale of business/branches -  1,600  Provision for loan losses 17,112  35,550  Noninterest expense 244,370  229,940  Pretax income 164,123  155,121  Income tax expense 56,214  52,983  Net income $ 107,909  $ 102,138  Diluted earnings per share $ 0.85  $ 0.81  Diluted weighted average shares outstanding 126,793  126,188  Three Months Ended 2006  Dec 31 Sep 30 Jun 30 SELECTED RATIOS Average common equity to average assets 8.22  % 7.97  % 7.86  % Average loans to average total deposits 108.19  107.85  105.80  Return on average assets 1.38  1.39  1.40  Return on average equity 16.73  17.49  17.75  Efficiency ratio [b] 56.58  56.38  55.39  Return on average tangible equity [c] 23.15  24.54  25.30  Book value per common share $ 21.71  $ 21.19  $ 20.15    Three Months Ended 2006  2005  Mar 31 Dec 31 SELECTED RATIOS Average common equity to average assets 7.44  % 7.32  % Average loans to average total deposits 106.74  109.05  Return on average assets 1.42  1.34  Return on average equity 19.03  18.24  Efficiency ratio [b] 56.66  54.57  Return on average tangible equity [c] 23.13  21.94  Book value per common share $ 19.82  $ 18.10  Dec 31, Sep 30, Annualized 2006  2006  % Change  ENDING BALANCE SHEET Total loans $24,665,273  $24,537,734  2  Total loans - managed 25,662,752  25,561,837  2  Total investment securities [d] 6,640,948  6,548,576  6  Earning assets [d] 31,365,457  31,170,846  2  Total assets 34,199,755  33,957,211  3  Noninterest bearing demand deposits 6,459,669  6,629,492  (10) Interest bearing transaction accounts 9,211,360  8,949,948  12  Total transaction accounts 15,671,029  15,579,440  2  Total deposits [d] 23,045,529  22,822,649  4  Shareholders' equity 2,824,134  2,748,244  11      Dec 31, Sep 30, Annualized 2006  2006  % Change  QUARTER AVERAGE BALANCE SHEET Total loans $24,785,123  $24,448,785  6  Total loans - managed 25,782,504  25,508,977  4  Total investment securities [d] 6,537,468  6,499,684  2  Earning assets [d] 31,386,030  31,023,938  5  Total assets 34,128,376  33,799,102  4  Noninterest bearing demand deposits 6,221,719  6,267,429  (3) Interest bearing transaction accounts 9,077,514  8,956,076  5  Total transaction accounts 15,299,233  15,223,505  2  Total deposits [d] 22,908,482  22,668,248  4  Shareholders' equity 2,804,989  2,693,549  17      [a] Excludes trading settlements and losses on economic hedge swaps, net gain (loss) on sales of investment securities, gain on prepayment of FHLB advances and gain on sales of business / branches. [b] Ratio is calculated by dividing noninterest expense less merger and integration and operating lease write-down expense by taxable equivalent net interest income plus noninterest income less net gain (loss) on sales of investment securities, gains on sales of business / branches and gain on prepayment of FHLB advances. [c] Excludes amortization of intangibles, net of tax, and intangible assets. [d] Includes adjustment for market valuation. COMPASS BANCSHARES, INC. (Unaudited) (In thousands)   2006  Dec 31 Sep 30 Jun 30 NONPERFORMING ASSETS Nonaccrual loans $ 53,014  $ 49,340  $ 53,166  Renegotiated loans 3,258  3,267  3,276  Other real estate, net 17,105  15,886  11,803  Total nonperforming assets $ 73,377  $ 68,493  $ 68,245  Accruing loans ninety days or more past due $ 18,023  $ 18,190  $ 14,862  Other repossessed assets 856  494  565  Total nonperforming assets as a % of loans and ORE 0.30  % 0.28  % 0.28  %     2006  2005  Mar 31 Dec 31 NONPERFORMING ASSETS Nonaccrual loans $ 55,716  $ 47,578  Renegotiated loans 3,286  698  Other real estate, net 11,155  11,510  Total nonperforming assets $ 70,157  $ 59,786  Accruing loans ninety days or more past due $ 16,080  $ 14,539  Other repossessed assets 599  763  Total nonperforming assets as a % of loans and ORE 0.30  % 0.28  %     Three Months Ended 2006  Dec 31 Sep 30 Jun 30 ALLOWANCE FOR LOAN LOSSES Balance at beginning of period $292,012  $289,143  $282,457  Net charge-offs (NCO) 22,004  21,357  16,557  Allowance acquired (transferred) -  -  (4,079) Provision for loan losses 21,042  24,226  27,322  Balance at end of period $291,050  $292,012  $289,143  Allowance for loan losses as a % of total loans 1.18  % 1.19  % 1.19  %   Allowance for loan losses as a % of nonperforming loans 517.22  555.08  512.28    Allowance for loan losses as a % of nonperforming assets 396.65  426.34  423.68    Annualized as a % of average loans: NCO - QTD 0.35  0.35  0.28  NCO - YTD 0.32  0.31  0.30  Three Months Ended 2006  2005  Mar 31 Dec 31 ALLOWANCE FOR LOAN LOSSES Balance at beginning of period $267,173  $260,512  Net charge-offs (NCO) 17,086  28,889  Allowance acquired (transferred) 15,258  -  Provision for loan losses 17,112  35,550  Balance at end of period $282,457  $267,173    Allowance for loan losses as a % of total loans 1.21  % 1.25  %   Allowance for loan losses as a % of nonperforming loans 478.72  553.43    Allowance for loan losses as a % of nonperforming assets 402.61  446.88    Annualized as a % of average loans: NCO - QTD 0.32  0.54  NCO - YTD 0.32  0.48  COMPASS BANCSHARES, INC. (Unaudited) (In thousands)   Three Months Ended December 31 2006  YIELD/RATE ANALYSIS Average Income/ Yield/ (Taxable Equivalent Basis) Balance Expense Rate   Assets Earning assets: Loans $24,785,123  $ 466,088  7.46  % Investment securities held to maturity 1,998,554  23,134  4.59  Investment securities available for sale [a] 4,586,984  56,303  4.87  Other earning assets 63,439  827  5.17  Total earning assets [a] 31,434,100  546,352  6.90  Allowance for loan losses (293,683) Unrealized loss on securities available for sale (48,070) Other assets 3,036,029  $34,128,376    Liabilities and Shareholders' Equity Interest bearing liabilities: Interest bearing transaction accounts $ 9,077,514  58,347  2.55  Time deposits 3,730,229  45,152  4.80  Certificates of deposit of $100,000 or more [a] 3,878,129  48,124  4.92  Federal funds purchased and securities sold under agreement to repurchase 3,079,450  40,467  5.21  Other short-term borrowings 833,835  10,911  5.19  FHLB and other borrowings [a] 4,082,215  59,818  5.81  Total interest bearing liabilities [a] 24,681,372  262,819  4.22  Net interest spread 283,533  2.68  %   Noninterest bearing demand deposits 6,221,719  Other liabilities 420,296  Shareholders' equity 2,804,989  $34,128,376  Net yield on earning assets 3.58  %   Taxable equivalent adjustment: Loans 724  Investment securities held to maturity 669  Investment securities available for sale 1,513  Other earning assets 12  Total taxable equivalent adjustment 2,918  Net interest income $ 280,615    [a] Excludes adjustment for market valuation. Three Months Ended December 31 2005  YIELD/RATE ANALYSIS Average Income/ Yield/ (Taxable Equivalent Basis) Balance Expense Rate   Assets Earning assets: Loans $21,145,075  $ 351,137  6.59  % Investment securities held to maturity 2,311,550  27,875  4.78  Investment securities available for sale [a] 4,614,914  49,077  4.22  Other earning assets 66,377  718  4.29  Total earning assets [a] 28,137,916  428,807  6.05  Allowance for loan losses (263,330) Unrealized loss on securities available for sale (79,539) Other assets 2,557,084  $30,352,131    Liabilities and Shareholders' Equity Interest bearing liabilities: Interest bearing transaction accounts $ 7,650,828  26,676  1.38  Time deposits 2,457,390  23,576  3.81  Certificates of deposit of $100,000 or more [a] 3,371,828  33,534  3.95  Federal funds purchased and securities sold under agreement to repurchase 4,065,294  40,709  3.97  Other short-term borrowings 225,908  2,072  3.64  FHLB and other borrowings [a] 4,087,197  47,337  4.59  Total interest bearing liabilities [a] 21,858,445  173,904  3.16  Net interest spread 254,903  2.89  %   Noninterest bearing demand deposits 5,910,240  Other liabilities 362,428  Shareholders' equity 2,221,018  $30,352,131  Net yield on earning assets 3.59  %   Taxable equivalent adjustment: Loans 318  Investment securities held to maturity 536  Investment securities available for sale 215  Other earning assets 9  Total taxable equivalent adjustment 1,078  Net interest income $ 253,825    [a] Excludes adjustment for market valuation. COMPASS BANCSHARES, INC. (Unaudited) (In thousands)   Year Ended December 31 2006  YIELD/RATE ANALYSIS Average Income/ Yield/ (Taxable Equivalent Basis) Balance Expense Rate Assets Earning assets: Loans $23,713,038  $1,735,236  7.32  % Investment securities held to maturity 2,121,500  101,269  4.77  Investment securities available for sale [a] 4,528,184  212,543  4.69  Other earning assets 73,127  3,649  4.99  Total earning assets [a] 30,435,849  2,052,697  6.74  Allowance for loan losses (285,189) Unrealized loss on securities available for sale (82,636) Other assets 2,944,326  $33,012,350    Liabilities and Shareholders' Equity Interest bearing liabilities: Interest bearing transaction accounts $ 8,770,985  190,772  2.18  Time deposits 3,430,703  155,259  4.53  Certificates of deposit of $100,000 or more [a] 3,728,787  173,752  4.66  Federal funds purchased and securities sold under agreement to repurchase 3,209,170  158,602  4.94  Other short-term borrowings 684,405  33,733  4.93  FHLB and other borrowings [a] 4,000,673  217,299  5.43  Total interest bearing liabilities [a] 23,824,723  929,417  3.90  Net interest spread 1,123,280  2.84  %   Noninterest bearing demand deposits 6,196,642  Other liabilities 387,819  Shareholders' equity 2,603,166  $33,012,350  Net yield on earning assets 3.69  %   Taxable equivalent adjustment: Loans 2,303  Investment securities held to maturity 2,580  Investment securities available for sale 3,225  Other earning assets 38  Total taxable equivalent adjustment 8,146  Net interest income $1,115,134    [a] Excludes adjustment for market valuation. Year Ended December 31 2005  YIELD/RATE ANALYSIS Average Income/ Yield/ (Taxable Equivalent Basis) Balance Expense Rate   Assets Earning assets: Loans $20,049,588  $1,236,153  6.17  % Investment securities held to maturity 2,509,642  121,405  4.84  Investment securities available for sale [a] 4,570,904  189,333  4.14  Other earning assets 61,410  2,347  3.82  Total earning assets [a] 27,191,544  1,549,238  5.70  Allowance for loan losses (257,919) Unrealized loss on securities available for sale (49,453) Other assets 2,560,060  $29,444,232    Liabilities and Shareholders' Equity Interest bearing liabilities: Interest bearing transaction accounts $ 7,396,716  74,186  1.00  Time deposits 2,542,086  88,495  3.48  Certificates of deposit of $100,000 or more [a] 2,826,672  98,298  3.48  Federal funds purchased and securities sold under agreement to repurchase 4,175,841  133,595  3.20  Other short-term borrowings 182,911  4,994  2.73  FHLB and other borrowings [a] 4,114,354  176,605  4.29  Total interest bearing liabilities [a] 21,238,580  576,173  2.71  Net interest spread 973,065  2.99  %   Noninterest bearing demand deposits 5,702,201  Other liabilities 333,389  Shareholders' equity 2,170,062  $29,444,232  Net yield on earning assets 3.58  %   Taxable equivalent adjustment: Loans 1,224  Investment securities held to maturity 2,261  Investment securities available for sale 560  Other earning assets 41  Total taxable equivalent adjustment 4,086  Net interest income $ 968,979    [a] Excludes adjustment for market valuation. COMPASS BANCSHARES, INC. (Unaudited) (In thousands)   Year Ended December 31 % 2006  2005  Change NONINTEREST INCOME Service charges on deposit accounts $ 311,520  $ 297,080  5  Card and merchant processing fees 111,302  95,591  16  Insurance commissions 61,634  59,362  4  Retail investment sales 41,338  33,890  22  Asset management fees 33,882  28,689  18  Corporate and correspondent investment sales 22,799  23,487  (3) Bank owned life insurance 20,638  17,467  18  Other income 101,952  99,877  2  705,065  655,443  8  Trading settlements on economic hedge swaps -  13,398  (100) Trading losses on economic hedge swaps -  (16,633) (100) Investment securities gains (losses), net (14,889) 79  NM  Gain on prepayment of FHLB advances 21,084  -  -  Gain on sale of business / branches -  6,391  (100) Total noninterest income $ 711,260  $ 658,678  8      NONINTEREST EXPENSE Salaries and benefits $ 569,761  $ 487,819  17  Equipment expense 91,325  81,979  11  Net occupancy expense 74,272  66,937  11  Professional services 63,609  61,640  3  Marketing expense 50,879  43,802  16  Communications expense 24,509  21,793  12  Amortization of intangibles 12,377  6,151  101  Merger and integration expense 10,659  1,641  NM  Other expense 141,343  130,041  9  1,038,734  901,803  15  Operating lease write-down 10,541  -  -  Total noninterest expense $ 1,049,275  $ 901,803  16        Three Months Ended 2006  Dec 31 Sep 30 Jun 30 NONINTEREST INCOME Service charges on deposit accounts $ 75,880  $ 81,155  $ 82,317  Card and merchant processing fees 27,857  29,065  28,673  Insurance commissions 13,698  14,855  15,477  Retail investment sales 9,826  11,188  10,904  Asset management fees 9,425  8,301  8,408  Corporate and correspondent investment sales 5,979  5,984  5,607  Bank owned life insurance 5,298  5,246  5,191  Other income 31,546  23,056  24,840  179,509  178,850  181,417  Trading settlements on economic hedge swaps -  -  -  Trading losses on economic hedge swaps -  -  -  Investment securities gains (losses), net -  -  (51) Gain on prepayment of FHLB advances 6,191  -  -  Gain on sale of business / branches -  -  -  Total noninterest income $ 185,700  $ 178,850  $ 181,366      NONINTEREST EXPENSE Salaries and benefits $ 144,102  $ 145,340  $ 144,309  Equipment expense 23,755  23,437  22,586  Net occupancy expense 18,982  19,457  18,616  Professional services 16,958  15,851  15,896  Marketing expense 11,564  12,816  14,235  Communications expense 5,984  6,752  6,151  Amortization of intangibles 3,883  3,456  3,548  Merger and integration expense 970  1,840  5,223  Other expense 36,758  36,609  35,286  262,956  265,558  265,850  Operating lease write-down 10,541  -  -  Total noninterest expense $ 273,497  $ 265,558  $ 265,850  Three Months Ended 2006  2005  Mar 31 Dec 31 NONINTEREST INCOME Service charges on deposit accounts $ 72,168  $ 77,056  Card and merchant processing fees 25,707  25,491  Insurance commissions 17,604  14,180  Retail investment sales 9,420  7,913  Asset management fees 7,748  7,596  Corporate and correspondent investment sales 5,229  7,096  Bank owned life insurance 4,903  4,615  Other income 22,510  25,143  165,289  169,090  Trading settlements on economic hedge swaps -  2,150  Trading losses on economic hedge swaps -  (6,054) Investment securities gains (losses), net (14,838) -  Gain on prepayment of FHLB advances 14,893  -  Gain on sale of business / branches -  1,600  Total noninterest income $165,344  $166,786      NONINTEREST EXPENSE Salaries and benefits $136,010  $124,734  Equipment expense 21,547  20,702  Net occupancy expense 17,217  16,416  Professional services 14,904  17,252  Marketing expense 12,264  9,936  Communications expense 5,622  5,470  Amortization of intangibles 1,490  1,495  Merger and integration expense 2,626  718  Other expense 32,690  33,217  244,370  229,940  Operating lease write-down -  -  Total noninterest expense $244,370  $229,940    NM - Not meaningful