Maturities and Interest Rates Exchanged on Swaps Table 13

			Mature During
(Dollars in millions)			2001	2002	2003	2004	2005	2008	2009	Total
Receive Fixed Swaps:
	Notional amount		$ 607	$ 970	$ 290	$ 350	$ 150	$ 125	$ 175	$ 2,667
	Receive rate		6.44%	6.62%	6.34%	6.21%	6.25%	6.15%	6.22%	6.43%
	Pay rate		6.41%	6.72%	6.73%	6.73%	6.82%	6.80%	6.82%	6.67%

Interest Rate Risk AmSouth uses a number of measures to monitor and manage interest rate risk. An earnings simulation model is the primary tool used to assess the direction and magnitude of the changes in NII caused by changes in interest rates. Key assumptions in the model include prepayment speeds on mortgage-related assets; cash flows and maturities of derivatives and other financial instruments held for purposes other than trading; changes in market conditions, loan volumes and pricing; deposit sensitivity; customer preferences; and management’s financial and capital plans. These assumptions are inherently uncertain and, as a result, the model cannot precisely estimate NII or precisely predict the impact of higher or lower interest rates on NII, but it can indicate the likely direction of change. Actual results will differ from simulated results due to timing, magnitude and frequency of interest rate changes and changes in market conditions and management’s strategies, among other factors.

Based on the results of the simulation model as of December 31, 2000, NII would decrease $2.0 million or 0.10 percent if interest rates gradually increased from then-current rates by 100 basis points over a 12-month period and would be unchanged if interest rates gradually decreased under the same scenario. This level of interest rate risk is well within the Company’s policy guidelines. As of December 31, 1999, the simulation model indicated that NII would decrease $38.4 million or 2.3 percent and increase $25.3 million or 1.5 percent if interest rates gradually increased or decreased, respectively, from their current rates by 100 basis points over a 12-month period. For June 1999 through May 2000, interest rates rose 175 basis points.

The significant reduction in AmSouth’s interest sensitivity compared to 1999 is primarily the result of the financial restructuring initiated in the third quarter of 2000. As part of the financial restructuring, AmSouth sold $4.0 billion of low-yielding fixed-rate investment securities and securitized and sold approximately $1.0 billion of low-yielding fixed-rate automobile loans. These fixed-rate assets were primarily funded by floating-rate overnight and other short-term borrowings. This action has significantly reduced the impact of interest rate fluctuations on NII.

In connection with the financial restructuring, an independent review was done of the interest rate risk management process. While AmSouth’s existing simulation model was found to be operating appropriately, management began expanding the interest rate sensitivity model to include different and more extreme interest rate scenarios such as those experienced in 1999 and 2000. In addition, variations in other key assumptions, such as loan and deposit volume and pricing, are also being stress-tested in net interest income risk modeling.

AmSouth uses various off-balance sheet financial instruments to assist in managing interest rate risk. AmSouth had interest rate swaps as of December 31, 2000, in the notional amount of $2.7 billion. Of these swaps, $1.0 billion of notional value was used to hedge the cash flow of variable-rate securities and commercial loans. The remaining $1.7 billion of notional value of swaps was used to hedge the fair value of fixed-rate consumer certificates of deposit and corporate and bank debt. See Note 1 and Note 13 to the Consolidated Financial Statements for further discussion of off-balance-sheet derivatives.

Table 12 summarizes the activity, by notional amount, of off-balance sheet financial instruments utilized in the asset and liability management process at AmSouth for the years 2000, 1999 and 1998.

Table 13 summarizes the expected maturities on all of AmSouth’s off-balance sheet positions at December 31, 2000, and interest rates exchanged on swaps. Both the timing of the maturities and the variable interest payments and receipts vary as certain interest rates change. The maturities and interest rates exchanged are calculated assuming that interest rates remain unchanged from average December 2000 rates. The information presented could change as future interest rates increase or decrease.