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credit quality, strong capital ratios and diverse funding sources, in addition to disciplined liquidity monitoring procedures. 

The Bancorp’s senior debt credit ratings are summarized in Table 46. The ratings reflect the ratings agencies view on the Bancorp’s capacity to meet financial commitments.* Additional information on senior debt credit ratings is as follows: 

• Moody’s “Baa1” rating is considered medium-grade obligations and is the fourth highest ranking within its overall classification system; 

• Standard & Poor’s “BBB” rating indicates the obligor’s capacity to meet its financial commitment is adequate and is the fourth highest ranking within its overall classification system; 

• Fitch Ratings’ “A-” rating is considered high credit quality and is the third highest ranking within its overall classification system; and 

• DBRS Ltd.’s “A (low)” rating is considered satisfactory credit quality and is the third highest ranking within its overall classification system. 

Additionally, the Bancorp’s subsidiary bank (Fifth Third Bank) also receives independent credit ratings. On November 1, 2010, Moody’s downgraded ten large regional banks, including Fifth Third Bank, due to the passage of the Dodd-Frank Act. The Act signaled the government’s intent to limit support for individual banks, thus reducing Moody’s support assumptions for these banks. Fifth Third Bank’s credit ratings for Short-Term, Long- Term Deposit, Senior Debt and Subordinated Debt were downgraded to P-2, A3, A3 and Baa1, respectively, from P-1, A2, A2 and A3, respectively. Additionally, Moody’s changed Fifth Third Bancorp and Fifth Third Bank’s outlook from negative to stable. During 2010, DBRS Investors Service downgraded the long-term debt rating and deposit ratings for the Bancorp’s subsidiary to “A” from “AH”. 

* As an investor, you should be aware that a security rating is not a recommendation to buy, sell or hold securities, that it may be subject to revision or withdrawal at any time by the assigning rating organization and that each rating should be evaluated independently of any other rating. 

## CAPITAL MANAGEMENT 

Management, including the Bancorp’s Board of Directors, regularly reviews the Bancorp’s capital position to help ensure it is appropriately positioned under various operating environments. 

## 2009 Capital Actions 

On May 7, 2009, the Bancorp announced its SCAP results which indicated that the Bancorp’s Tier 1 common equity would be required to be augmented to maintain a capital buffer above the newly required four percent threshold of the Tier 1 common equity ratio under the more adverse scenario of the assessment. The total amount required, prior to considering activities by the 

Bancorp since the end of the fourth quarter of 2008, was $2.6 billion. 

After considering such activities, primarily the Processing Business Sale, the indicated additional net Tier I common equity required was $1.1 billion. To address the SCAP results the Bancorp undertook a number of capital actions during the second quarter of 2009. The Bancorp completed a $1 billion common stock offering and issued approximately 158 million shares at an average price of $6.33. In addition, the Bancorp completed an exchange of a portion of its Series G preferred stock for 2,158.8272 shares of its common stock, no par value, and $8,250 in cash, for each set of 250 validly tendered and accepted depositary shares. The Bancorp issued approximately 60 million shares of common stock and paid $230 million in cash in exchange for 7 million depositary shares. After settlement of the exchange offer, 4,112,750 depositary shares representing 16,451 shares of Series G preferred stock remained outstanding. As a result of this exchange, the Bancorp increased its common equity by $441 million. The Bancorp also sold its Visa, Inc. Class B common shares resulting in an additional $187 million benefit to equity. 

## 2011 Capital Actions 

On January 25, 2011, the Bancorp raised $1.7 billion in new common equity through the issuance of 121,428,572 shares of common stock in an underwriting offering at an initial price of $14.00 per share. On January 24, 2011, the underwriters exercised their option to purchase an additional 12,142,857 shares at the offering price of $14.00 per share. In connection with this exercise, the Bancorp elected that all such additional shares be sold and the Bancorp entered into a forward sale agreement which resulted in a final net payment of 959,821 shares on February 4, 2011. 

On February 2, 2011, the Bancorp redeemed all 136,320 shares of its Series F Preferred Stock held by the U.S. Treasury totaling $3.4 billion. The Bancorp used the net proceeds from the common stock and senior notes offerings previously described and other funds to redeem the Series F Preferred Stock. 

In connection with the redemption of the Series F Preferred Stock, the Bancorp accelerated the accretion of the remaining issuance discount on the Series F Preferred Stock and recorded a corresponding reduction in retained earnings of $153 million. 

Dividends of $15 million were paid on February 2, 2011 when the Series F Preferred Stock was redeemed. The Bancorp notified the U.S. Treasury on February 17, 2011, of its intention to negotiate for the purchase of the warrants issued to the U.S. Treasury in connection with the CPP preferred stock investment. 

These transactions will be reflected in the Bancorp’s consolidated financial statements for the quarter ended March 31, 2011. Note 32 of the Notes to Consolidated Financial Statements provides additional information regarding the redemption of the Series F Preferred Stock and the January 2011 common stock offering. 

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