M ARSHALL & ILSLEY C ORPORATION

Transcription

1 M ARSHALL & ILSLEY C ORPORATION 1999 Summary Annual Report

2 In Memoriam John A. Puelicher On October 30, 1999, John A. Jack Puelicher, former chairman of the board of Marshall & Ilsley Corporation, passed away at home at age 78 after fighting cancer since early spring. He will be missed by his friends and associates, however we will continue to remember his contributions to M&I, the banking industry and our community. Jack Puelicher s career at Marshall & Ilsley Corporation spanned over 50 years, 29 of which he spent leading M&I Marshall & Ilsley Bank and Marshall & Ilsley Corporation. The son of Albert S. Puelicher and grandson of John H. Puelicher, Jack Puelicher was the third generation of the Puelicher family to lead M&I. Jack Puelicher began his career at the bank as a part-time employee while attending Riverside High School. He attended Dartmouth College and graduated from the University of Wisconsin-Madison in He served as a Navy Lieutenant j.g. in the Pacific Fleet during World War II, returning to the bank in In 1952 he was elected vice president and director. In December 1956, he was elected executive vice president and in 1958 he was elected president. Upon his father s death in 1963, he was elected chairman of the board and president of the Bank and Marshall & Ilsley Bank Stock Corp. (now Marshall & Ilsley Corporation). In 1989, he relinquished the title of chairman of M&I Marshall & Ilsley Bank and in 1992 the title of chairman of Marshall & Ilsley Corporation. Jack was a very private person who lived by the Golden Rule. He cared deeply about his family, his country, Marshall & Ilsley Corporation, its employees and their families. He had great loyalty to his friends and the customers of the bank. Jack led by example and never asked more of others than he asked of himself. He demanded excellence and held himself and those around him accountable. He built the foundation for our growth and set the high standards by which we do business. He constantly reminded us to Do what is right. We will miss him! James B. Wigdale Chairman and Chief Executive Officer Marshall & Ilsley Corporation Marshall & Ilsley Corporation grew from $420 million to $7.85 billion in assets during his tenure. Following retirement, Jack continued as a director of the Corporation and a consultant to management. Jack will be greatly missed by his colleagues and many friends Summary Annual Report 1

3 Financial Highlights ($000 s except share data) Net Income $354,511 $301,323 $256,685 Per Share Basic $3.32 $2.79 $2.62 Diluted Dividends Declared Shareholders Equity Financial Condition Average Assets $22,700,963 $20,790,173 $17,001,414 Loans 14,909,225 13,403,297 10,979,613 Deposits 16,156,902 14,757,215 12,239,795 Shareholders Equity 2,172,117 2,133,037 1,556,366 Other Significant Data Return on Average Shareholders Equity 16.32% 14.13% 16.49% Return on Average Assets Shareholders Equity to Total Assets Net Loan and Lease Charge-offs to Average Loans and Leases Allowance for Loan and Lease Losses to End of Period Loans and Leases Marshall & Ilsley Corporation

4 To Our Shareholders 1999 was another good year for Marshall & Ilsley Corporation. For the third consecutive year, earnings per share grew over 13 percent. Earnings were $354.5 million, or $3.14 per share, an increase of 13.8 percent over the prior year. Highlights of 1999 included the introduction of new online retail, business banking and mortgage products to complement our suite of Web-based services. We also enhanced our existing products to give our customers additional options in managing their finances. Our M&I Data Services division, a leading provider of e-commerce technology, achieved impressive 18 percent revenue growth. We reached many milestones during the year. Assets under management in our trust company surpassed $11 billion for the first time and our banking support division, M&I Support Services Corp., received ISO 9002 certification, becoming the first banking organization in the nation to do so. And, as a result of our Y2K preparedness, and the efforts of our employees, the transition to the Year 2000 was a smooth one for our bank and processing customers, our employees and our shareholders. On November 12, Marshall & Ilsley Corporation joined the New York Stock Exchange. The NYSE will offer Marshall & Ilsley Corporation the broadest and most efficient trading market possible, increase liquidity, reduce trading volatility and broaden our investor base. The year was also marked by deep sadness with the passing of our former chairman and CEO, Jack Puelicher, in October. He will be remembered as a man of strong will who worked hard and made countless contributions to the banking industry, the community and the lives of those he knew. We will miss his integrity, vision and friendship very much. Sincerely, James B. Wigdale Chairman Photo: Marshall & Ilsley Corporation joined the New York Stock Exchange on November 12, Dennis J. Kuester President Marshall & Ilsley Corporation President M&I Marshall & Ilsley Bank Chairman of the Board M&I Data Services James B. Wigdale Chairman of the Board and Chief Executive Officer Marshall & Ilsley Corporation Chairman of the Board and Chief Executive Officer M&I Marshall & Ilsley Bank Gordon H. Gunnlaugsson Executive Vice President and Chief Financial Officer Marshall & Ilsley Corporation 1999 Summary Annual Report 3

5 Our Commitment to Customer Service Excellence When people hear the name M&I, they associate it with a well-respected financial services company which has, ever since they can remember, been serving the financial needs of our communities. When our customers hear M&I, the name means even more. It stands for the values that attracted them to M&I in the first place...integrity and excellence. We talk a great deal about tradition at M&I. It s a tradition of service that generations of customers have experienced over the past 150-plus years. But even our newest customers can sense our commitment to excellence as they walk through our doors for the first time. We strive to uphold that tradition each and every day. And because we have been successful, we are able to provide our customers with a strong financial partner and our shareholders with a consistent rate of return over the long term. We take pride in getting to know our customers and our customers businesses well. No matter what their needs, we take the time to exceed our customers expectations. We have a reputation for partnering with our customers as they establish their financial relationships and staying with them even if they experience difficult times. We stay close to our customers, whether they are a large corporation looking to finance global expansion, a nationwide financial institution needing our banking expertise, a married couple interested in setting up a trust, or recent college graduates just beginning to save for their futures. The investments we make in new products and services help us serve all of our markets better, both now and in the future. We continue to build better systems, hire highly dedicated employees and concentrate our efforts on giving our customers unparalleled service. Our employees share our vision and are committed to preserving the tradition we ve worked hard to cultivate throughout our history. Our customers expect excellence, whether they are looking for the tools they need to manage their personal finances, the expertise to help them grow their business or the resources to make their dreams come true. And in a world where technology has revolutionized the way we do business, we re able to provide our customers with even more options to succeed, no matter what their goals. Technology has also allowed us to enhance the personal service for which we re known. By having a wealth of resources at our fingertips, we are able to dedicate ourselves to serving our customers. 4 Marshall & Ilsley Corporation

6 Providing Our Commercial Clients with Tools for Success Nineteen ninety-nine was a very successful year for M&I s Commercial Banking area. We continued to invest in the products and services that best serve our markets and focused on giving customers the exemplary service for which M&I is known. We have been rewarded for our efforts with a high level of customer retention and the addition of many new clients. All of our employees, including several new, experienced professionals who joined M&I in 1999, are dedicated to ensuring our clients have the products and services they need to be successful. Our highly regarded commercial bankers also share a strong commitment to meeting those needs with an attention to detail and an unsurpassed customer focus. Our customers businesses are changing and we are here to help make sure their needs are met as they grow. In 1999, we offered several new services to our clients to help them manage day-to-day details. Our commercial customers now have the ability to place international wires in U.S. dollars or foreign currency through our Money Transfer Workstation. We have also laid the groundwork for presenting our international clients with their account balance information for any bank in the world via M&I s reporting service. On the domestic side, we enhanced our image capabilities in our lockbox service, created a small volume Check Printing Service to target clients with check runs of up to 2,000 checks and simplified the storage and access of cancelled checks by offering these images to our commercial clients on CD Rom. M&I First National Leasing leases all types of equipment and machinery to businesses nationwide. Often working in partnership with M&I Banks, other financial institutions and equipment vendors, M&I First National Leasing serves its customers from its headquarters in Milwaukee and 13 other locations across the United States. More and more, our clients are looking to technology to help them manage their business. Along this line, we have developed a Web-based banking product offering our commercial customers Internet access to many of our Treasury Management functions. In addition to receiving balance information, clients are able to place stop payments, initiate repetitive wires, transfer money among their M&I accounts and transfer money to other banks for payment of bills or to consolidate funds. Marketed under the MiWeb Business Bank line of Web-based products, this service is designed for our middle to large corporate customers. We are also working with M&I Data Services to expand our clients e-commerce opportunities by developing a comprehensive bill payment/ presentment solution Summary Annual Report 5

7 Giving Our Retail Customers New Options M&I serves the banking needs of Wisconsin residents with a network of over 200 offices and over 360 ATMs, providing a dominant presence in the bank s home state. M&I has a bank with 13 offices in Arizona and also has offices in Illinois, Florida and Nevada. miweb Our indirect consumer lending activities continue to grow. We expanded both our dealer finance and home equity businesses in 1999 and experienced significant earnings growth. Our dealer finance business is now in eight states and wholesale home equity is in seven states. Throughout 1999 we made it even easier for our retail customers to manage their finances by introducing new state-of-the-art products. Now customers can choose from a full line of Web-based products to monitor their checking and savings accounts, handle business transactions and take control of their investments. These new products, plus our extensive office and ATM networks, PC banking products and telephone banking services, give our customers more options than ever before. MiWeb Bank continues to be a popular resource for consumers who appreciate having access to their account information 24 hours a day. More and more, our customers are recognizing the benefits of being able to check a balance, transfer funds or pay a bill online. The first of its kind introduced by a Wisconsin-based bank, MiWeb Business Bank gives business customers instant access to their bank account information, enabling them to access balance and detail reports, export files directly to their accounting software for reconciliation, transfer funds and request stop payments. Advanced functionality includes electronic bill pay, cash disbursement for direct deposit and direct payment and electronic wire transfers. M&I was the first banking company in Wisconsin to offer online inquiry, trading and quotes for individual stock trades. MiBroker Online provides customers with instant online access to account information, net equity, cash, margins and more. Customers can place orders for stocks on the NYSE, Amex or OTC, place market or limit orders, and check, change or cancel orders any time prior to execution. Low commissions make this service even more attractive to consumers who want to take control of their investments. And now, customers have a place where they can organize all their online financial accounts. MiWeb World, M&I s personalized portal solution, gives customers a home base on the Internet from where they can access their M&I online accounts, navigate the Internet, and communicate with others online. While these online financial services support our existing customers, M&I also offers national Internet banking products through Web sites specializing in first and second mortgages and insured bank deposits. These best-of-class 6 Marshall & Ilsley Corporation

8 Web sites offer consumers convenience, the latest technology and personalized service as they apply for loans and savings products. Mortgagebot.com is the first major lender in the country to offer a binding, credit-verified, online first mortgage approval to consumers. Since its introduction in October 1998, it has generated more than $275 million of mortgages and is currently available in 48 states. In 1999, the site was expanded to include home equity loans, giving consumers 24-hour access to instant loan approvals and personalized online rate quotes for home equity loans and lines of credit. M&I s national Internet product line also includes savingsbot.com,a financial Web site that enables consumers to open federally insured certificate of deposit accounts (CDs) via the Internet. It takes most customers less than ten minutes to open a CD online, and with posted yields in the top one percent in the country, savingsbot.com ranks among the leaders in the CD marketplace. Committed to Quality Service Traditionally billed as a customer service call center, M&I Direct s role continues to evolve as technology changes how our customers manage their personal and business finances. Now M&I Direct serves as a multi-media center, offering support for M&I s PC and Web-based products, in addition to handling traditional telephone banking requests, such as balance and product inquiries. Customers using M&I Mortgage Corp. to secure a mortgage or refinance an existing mortgage have always enjoyed prompt service and quick turnaround. Now the customers we serve in our local markets can receive instant approvals. Our 200-plus loan offices and branches can approve a loan immediately, decreasing the amount of documentation needed, lowering processing costs and providing added convenience for our customers. Although many inquiries are still handled by phone over 7.6 million in 1999 alone M&I Direct also responded to over 130,000 s and over 120,000 fax requests. It also expanded the services it offers to M&I s business customers who can now access their account information by phone on MiLine, M&I s full service bank-by-phone product. Its dedication to excellence and desire to provide only the best customer service has earned M&I Support Services, and its M&I Direct division, ISO 9002 certification, the world s highest standard for quality. M&I Support Services received its certification at the end of 1999 and is the first major bank business unit to achieve this international quality standard in the United States Summary Annual Report 7