full text:
Growth reflects strong retail brokerage and traditional banking market expansion

  1st QUARTER 2007 COMPARED WITH 1st QUARTER 2006

  -- Double-digit earnings growth despite difficult interest rate
     environment. Results include acquisitions and divestitures.

  -- Record earnings in retail brokerage and asset management.

  -- Average core deposits up 27 percent. Outstanding checking account
     growth throughout footprint, with excellent results in expanded
     markets.

  -- Average loans up 59 percent, including acquisitions, with particular
     strength in commercial and small business lending. Expanded consumer
     franchise including auto lending and credit cards generating results
     ahead of expectations.

  -- Solid credit quality; increased provision reflects growth in credit
     card, commercial and auto lending.

  -- Customer loyalty scores reach high of 52.1%; organic customer
     acquisition grew 13.4% annualized.



  Earnings Highlights
                                                         Three Months Ended
                                         March 31, December 31,    March 31,
  (In millions, except per share             2007         2006         2006
   data)                            Amount    EPS  Amount  EPS  Amount  EPS
  Earnings
  Net income (GAAP)                $2,302    1.20  2,301  1.20  1,728  1.09
  Net merger-related and
   restructuring expenses               6       -     29  0.01     46  0.03
  Earnings excluding merger-
   related and restructuring
   expenses                        $2,308    1.20  2,330  1.21  1,774  1.12
  Discontinued operations, net of
   income taxes                         -       -    (46)(0.02)     -     -
  Earnings excluding merger-
   related and restructuring
   expenses, and discontinued
   operations                      $2,308    1.20  2,284  1.19  1,774  1.12
  Financial ratios
  Return on average common
   stockholders' equity             13.47 %        13.09        14.62
  Net interest margin (a)            3.01           3.09         3.21
  Fee and other income as % of
   total revenue (a)                45.41          46.32        49.84
  Overhead efficiency ratio (a)     55.70 %        57.38        60.07
  Capital adequacy (b)
  Tier 1 capital ratio                7.4 %          7.4          7.9
  Total capital ratio                11.5           11.3         11.5
  Leverage ratio                      6.1 %          6.0          6.9
  Asset quality (c)
  Allowance for loan losses as %
   of nonaccrual and restructured
   loans                              213 %          272          452
  Allowance for loan losses as %
   of loans, net                     0.80           0.80         1.08
  Allowance for credit losses as
   % of loans, net (d)               0.84           0.84         1.14
  Net charge-offs as % of average
   loans, net                        0.15           0.14         0.09
  Nonperforming assets as % of
   loans, net, foreclosed properties
   and loans held for sale           0.40 %         0.32         0.28

 (a)  Tax-equivalent.
 (b)  The first quarter of 2007 is based on estimates.
 (c)  Asset quality ratios at March 31, 2007 and December 31, 2006, reflect
      the impact of Golden West.
 (d)  The allowance for credit losses is the sum of the allowance for loan
      losses and the reserve for unfunded lending commitments.

Wachovia Corp. (NYSE:WB) today reported net income of $2.30 billion, or $1.20 per share, in the first quarter of 2007 compared with $1.73 billion, or $1.09 per share, in the first quarter of 2006.
After-tax net merger-related expenses did not affect earnings per share in the first quarter of 2007 and amounted to 3 cents per share in the first quarter of 2006. Excluding these expenses, earnings were $2.31 billion, or $1.20 per share, in the first quarter of 2007 and $1.77 billion, or $1.12 per share, in the first quarter of 2006. Results also included a lower effective tax rate of 30.99 percent compared with 35.06 percent in the first quarter of 2006.
"Once again our team delivered double-digit earnings growth," said Ken Thompson, Wachovia chairman and chief executive officer. "Our focus on cost control and risk management continues to provide flexibility in the face of the challenging interest rate environment. Most of all, our team's dedication to serving our customers has a direct impact on our results as we provide industry-leading customer service and grow our base of loyal customers. In addition, we're seeing very promising results as our cross-business partnerships serve customer needs and generate incremental revenues. The integration of Golden West is on track, and we're pleased with the cross-sell potential of our expanded mortgage platform, as well as our initial success in cross-selling existing World Savings banking customers."
Results in the first quarter of 2007 included the full quarter impact of the purchase accounting acquisitions of Golden West on October 1, 2006, and Westcorp on March 1, 2006. Results in the first quarter of 2006 included one month of results related to Westcorp and a $100 million termination payment received in relation to the Bank of America/MBNA merger.
For more information visit: http://www.wachovia.com/

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