-- 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

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 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."