Kenneth D. Lewis Chairman and Chief Executive Officer

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Kenneth D. LewisChairman and Chief Executive
Officer
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E-Commerce Valued Added Analysis - Methodology

• Time Series Analysis compared offline Customers
  with online Customers
• Groups matched with 40 pre-online
  characteristics (e.g. age, income, account
  balances, transaction activity, profitability,
  and VRU/CSR usage)
• Analysis spans 31 months (beginning 4Q 1998) and
  includes over 300,000 customers

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E-Commerce Valued Added Analysis
1
3

5
100
95

Profit per customer after 9 months (Indexed)


1
3

22
114
100
Profit per customer after 19 months (Indexed)
1
3

27
121
100
Profit per customer after 31 months (Indexed)
Customer Profitability (before going online)
Relationship Deepening
Retention Increase
Cost-to-serve Reduction
Customer Profitability (after going online)
Online Cost
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Key Online Profitability DriversRelationship
DeepeningDeposit Products
DEPOSIT BALANCES
DEPOSIT ACCOUNTS
11 Months
19 Months
31 Months
11 Months
19 Months
31 Months
Percent increases over matched control group
Sample includes customers who obtained online
access in Nov. 98 - Feb. 99
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Key Online Profitability DriversRelationship
DeepeningLoan Products
LOAN BALANCES
NUMBER OF LOANS
11 Months
19 Months
31 Months
11 Months
19 Months
31 Months
Percent increases over matched control group
Sample includes customers who obtained online
access in Nov. 98 - Feb. 99
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