DBRS Rates National City Corporation at A (high)

Dominion Bond Rating Service (“DBRS”) has today assigned ratings to National City Corporation (“NCC” or the “Holding Company”) and its seven operating bank subsidiaries (the “Banks”), indicated above. The trends are Stable.

The ratings of the Banks are based on their strong, stable, and sustainable earnings, healthy profitability, and good asset quality performance. The ratings also consider the Banks’ relatively high reliance on wholesale funding, elevated – albeit properly managed – interest rate risk exposure, and potential asset quality problems in the residential mortgage portfolio in case of a severe market correction. A material portion of the portfolio held consists of sub-prime mortgages. The ratings also incorporate the potential for weakening profitability in light of severe competition both within their operating footprint and in their nation-wide businesses.

NCC benefits from a diversified business mix, including leading or top-tier deposit market shares in its Midwestern operating footprint, well-established consumer and commercial banking franchises, a substantial nationwide home equity and residential mortgage business, and a broad range of treasury, wealth management, and other fee- and commission-based services. The strong and varied business mix, together with an efficient operating platform and initiatives to further build out and fine-tune the franchise, underlie NCC’s attractive earnings characteristics and favourable long-term earnings prospects.

The same characteristics that generate strong and stable earnings also account for NCC’s above-average profitability – first half 2005 return on assets of 1.61%, net interest margin of 3.85%, and return on equity of 17.5% were generally better than those of many peers. These profitability indicators were better than those of banks rated similarly by DBRS, and those of unrated banks having similar business profiles. DBRS believes, however, that severe price competition in both its operating footprint and in its nationwide businesses may weaken NCC’s profitability, but that it is likely to remain superior to those of most of its peers because of the depth and breadth of the franchises.

Although NCC’s deposit business is strong in terms of market share and composition, the absolute level of core deposits is low relative to the loan portfolio and total assets. For the first half of 2005 average core deposits accounted for about 65% of average loans and 49% of total assets. This imbalance came about as loan growth has outpaced core deposit growth for at least the past five years, resulting in NCC’s relatively high – and rising – dependence on wholesale funding. At June 30, 2005, about 40% of funding came from wholesale sources, of which the great majority was long-term debt obligations. DBRS believes that such reliance on wholesale funding, particularly since the great majority is unsecured long-term debt, results in weaker bondholder protection. DBRS also believes that NCC’s strong capital, clean asset quality, and robust earnings mitigate this risk. NCC’s tangible common equity to tangible assets stood at 6.66% as at March 31, 2005, which was above those of most “super-regional” banks and for banks rated similarly by DBRS.

The Holding Company’s ratings are based on a conservative risk profile, evidenced by ample stand-alone unencumbered liquid assets and earnings to cover the Holding Company’s operating expenses, debt service obligations, and anticipated dividend payments for at least one year without relying on dividend income form the operating bank subsidiaries. Double leverage, particularly in view of the holding company’s strong liquidity, is not a material concern at 109% at June 30, 2005.

National City Corporation, a financial services holding company headquartered in Cleveland, Ohio, reported US$144 billion in assets as at June 30, 2005.