BBTsq4 2008 Fourth Quarte 2008 Shareholders_Report
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BBTsq4 2008 Fourth Quarte 2008 Shareholders_Report

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BBTsq4 2008 Fourth Quarte 2008 Shareholders_Report BBTsq4 2008 Fourth Quarte 2008 Shareholders_Report Document Transcript

  • BB&T reports 2008 net income of $1.5 billion; Earnings per common share total $2.71 January 22, 2009 On January 22, 2009, BB&T Corporation reported earnings The 2008 operating results exclude $66 million in after-tax securities gains, $39 million in after-tax other than temporary for the fourth quarter and the full year 2008. For the fourth impairment charges, $17 million in net after-tax gains quarter, net income totaled $305 million and net income related to a settlement with the Internal Revenue Service in available to common shareholders totaled $284 million, connection with leveraged lease transactions and $3 million or $.51 per diluted common share, compared with $411 in net after-tax merger-related and restructuring charges. million, or $.75 per diluted common share, earned during the fourth quarter of 2007. For the full year 2008, BB&T’s net income available to common shareholders was $1.50 billion compared to “The year 2008 was very challenging and credit $1.73 billion earned in 2007, a decrease of 13.6%. Diluted deterioration remains a significant concern; however, earnings per common share for 2008 totaled $2.71, a BB&T’s results rank among the top performers in decrease of 13.7% compared to $3.14 earned in 2007. the financial services industry,” said Chief Executive Officer Excluding net after-tax merger-related and restructuring Kelly S. King. “Even though the cost of the current credit charges or credits and nonrecurring items from 2008 cycle has depressed earnings, our overall results reflect and 2007, operating results for 2008 totaled $1.38 billion, a number of positive developments and demonstrate a decrease of 21.3% compared to $1.75 billion earned in that BB&T is gaining market share and growing. We are 2007. Diluted operating earnings per common share totaled implementing initial plans to deploy the capital invested $2.49 in 2008, a decrease of 21.5% compared to $3.17 in BB&T in connection with the U.S. Treasury’s Capital earned in 2007. Purchase Program, which include specific lending programs where we are actively seeking new borrowers. In addition, NoNperformiNg Assets ANd Credit Losses iNCreAse our pretax pre-provision earnings increased 10.6% in the “As anticipated, levels of nonperforming assets and credit fourth quarter compared to the same period last year, and losses increased further during the quarter as a result of we generated positive operating leverage for the year. the distressed residential real estate markets and economic These indicators demonstrate solid underlying performance recession,” said King. “These credit issues required an and consistent earnings power.” increase in the allowance for loan and lease losses which “Other positives from the quarter include an improvement reduced fourth quarter earnings. While it is difficult to know in the net interest margin compared to the third quarter, the full extent of the economic downturn and the resulting solid production from lending and deposit gathering impact on BB&T’s credit quality, we expect further increases efforts as we continue to benefit from a flight to quality in in nonperforming assets and net charge-offs into 2009.” our markets, healthy growth in many of our fee income Nonperforming assets, as a percentage of total assets, producing businesses, industry-leading capital levels, and increased to 1.34% at December 31, 2008, compared to an improvement in efficiency.” 1.20% at September 30, 2008. Annualized net charge-offs Operating earnings available to common shareholders for were 1.29% of average loans and leases for the fourth the fourth quarter of 2008 totaled $243 million, or $.44 per quarter of 2008, up from 1.00% in the third quarter. diluted common share, compared with $415 million, or Excluding losses incurred by BB&T’s specialized lending subsidiaries, annualized net charge-offs for the current $.75 per diluted common share for the fourth quarter 2007.
  • geNerAL iNformAtioN and 14.4%, respectively, at September 30, quarter were 1.06% of average loans and 2008. These increases reflect the $3.1 billion leases compared to .82% in the third of capital invested by the U.S. Treasury in the quarter of 2008. CorporAte HeAdquArters fourth quarter of 2008. BB&T’s risk-based BB&T Corporation The provision for credit losses totaled $528 capital ratios are significantly higher than an 200 West Second Street million in the fourth quarter of 2008, an average of its peers and remain well above Winston-Salem, NC 27101 increase of $344 million compared to the 336-733-2000 regulatory standards for well-capitalized same quarter last year, and exceeded net www.BBT.com banks. During the fourth quarter, BB&T charge-offs by $214 million. The higher declared a quarterly cash dividend of $.47 CoNtACts provision increased the allowance for loan and per share, up 2.2% compared to the fourth Analysts, investors and others lease losses as a percentage of loans held quarter of 2007. BB&T has increased the seeking additional financial for investment to 1.62% at December 31, cash dividend for 37 consecutive years and information should contact: 2008, compared to 1.45% at September 30, Tamera L. Gjesdal has paid a dividend every year since 1903. 2008, and 1.10% at December 31, 2007. The Senior Vice President stroNg BALANCe sHeet growtH increases in net charge-offs, nonperforming Investor Relations 336-733-3058 assets and the provision for credit losses Average loans and leases totaled $97.2 were driven by continued deterioration in billion for the fourth quarter of 2008, This report provides a summary residential real estate markets and the overall reflecting an increase of $6.4 billion, or overview of BB&T’s performance for economy with the largest concentration of 7.1%, compared to the fourth quarter of the fourth quarter of 2008. To obtain credit issues occurring in Georgia, Florida complete financial disclosures as 2007. Average deposits totaled $92.0 billion and metro Washington, D.C. contained in BB&T’s Forms 10-K for the fourth quarter of 2008, an increase and 10-Q filed with the Securities and of $6.7 billion, or 7.9%, compared to the BB&t BegiNs efforts to effeCtiveLy depLoy Exchange Commission, please contact: fourth quarter of last year. The growth rate in treAsury CApitAL iNvestmeNt Michael L. Nichols average client deposits was 6.3% compared to Senior Vice President During the fourth quarter of 2008, the the fourth quarter of 2007 and accelerated Shareholder Reporting U.S. Treasury invested $3.1 billion in BB&T 336-733-3079 to 8.1%, on an annualized basis, compared through the Capital Purchase Program to the third quarter of 2008. The pace of Media representatives and others (“CPP”). In compliance with the terms deposit growth accelerated throughout the seeking general information and conditions of the program, BB&T fourth quarter. Average securities available should contact: has incrementally increased loans and for sale totaled $26.6 billion for the fourth Robert A. Denham investments, as evidenced by significant quarter of 2008, an increase of 10.9% Senior Vice President balance sheet growth, which totaled $10.8 compared to the fourth quarter of 2007. The Corporate Communications billion excluding trade date accounting for 336-733-1475 increase in the securities portfolio reflects investments at December 31, 2008. The the initial deployment of the capital invested by sHAreHoLder serviCes additional lending programs include efforts the U.S. Treasury in connection with the CPP. BB&T Shareholder Services offers in corporate banking, consumer lending, Online Shareholder Services, allowing BB&t CoNtiNues to expANd insurance premium finance and equipment you secure, instant access to your tHrougH ACquisitioNs leasing. Loans and leases increased $2.0 BB&T Stock Account, including billion during the fourth quarter and the your account balance, certificate On December 12, 2008, BB&T announced pace of loan growth accelerated late in history, dividend reinvestment the acquisition of $506 million in deposits plan information and more. Choose the quarter. BB&T will continue to provide of Haven Trust Bank of Duluth, Georgia, Shareholder Services in the Personal incremental lending to qualified borrowers. through an agreement with the Federal Services Logon at www.BBT.com. For Deposit Insurance Corporation. In addition, more information, or for shareholder CApitAL LeveLs grow sigNifiCANtLy Grandbridge Real Estate Capital, LLC, a assistance, call Shareholder Services iN fourtH quArter commercial mortgage banking subsidiary of at 336-733-3477 or toll-free BB&T’s regulatory capital levels increased at 800-213-4314. BB&T, announced the acquisition of Live Oak significantly at December 31, 2008. BB&T’s Capital Ltd. and BB&T Insurance Services stoCk exCHANge ListiNg leverage ratio was 9.7%, up from 7.6% last continued to expand with the acquisitions The common stock of BB&T quarter. In addition, BB&T’s Tier 1 risk-based of J. Rolfe Davis Insurance Agency Inc. of Corporation is traded on the capital and total risk-based capital ratios were Maitland, Florida, and TAPCO Underwriters New York Stock Exchange under 12.0% and 17.1%, respectively, up from 9.4% Inc. of Burlington, North Carolina. the ticker symbol BBT.
  • Consolidated financial Highlights BB&T Corporation and Subsidiaries (Dollars in millions, except per share data) As of / for the three months ended As of / for the twelve months ended 12/31/08 12/31/07 % Change 12/31/08 12/31/07 % Change earnings and performance ratios $ 305 $ 1,519 Net income $ 411 (25.8) % $ 1,734 (12.4) % 284 1,498 Net income available to common shareholders 411 (30.9) 1,734 (13.6) .51 2.71 Diluted earnings per common share .75 (32.0) 3.14 (13.7) .47 1.86 Cash dividends per common share .46 2.2 1.76 5.7 .86 % 1.11 % Return on average assets 1.24 % 1.37 % 8.47 11.44 Return on average common equity1 12.89 14.25 3.47 3.58 Net interest margin (taxable equivalent) 3.46 3.52 40.5 41.4 Fee income ratio (taxable equivalent)2 41.7 41.3 54.0 52.1 Efficiency ratio (taxable equivalent)2 53.8 53.7 operating earnings and performance ratios 3 $ 264 $ 1,397 Operating earnings $ 415 (36.4) % $ 1,749 (20.1) % 243 1,376 Operating earnings available to common shareholders 415 (41.4) 1,749 (21.3) .44 2.49 Diluted earnings per common share .75 (41.3) 3.17 (21.5) .74 % 1.02 % Return on average assets 1.26 % 1.38 % 7.26 10.51 Return on average common equity1 13.00 14.37 3.68 3.63 Net interest margin (taxable equivalent) 3.46 3.52 39.0 40.3 Fee income ratio (taxable equivalent)2 41.7 41.3 51.9 52.6 Efficiency ratio (taxable equivalent)2 52.8 53.1 Cash Basis operating earnings and performance ratios3,4 Cash basis earnings available to common shareholders $ 257 $ 1,438 $ 432 (40.5) % $ 1,816 (20.8) % .46 2.60 Diluted earnings per common share .78 (41.0) 3.29 (21.0) .81 % 1.11 % Return on average tangible assets 1.37 % 1.50 % 13.45 19.30 Return on average common tangible equity 24.03 26.82 1 50.6 51.3 Efficiency ratio (taxable equivalent)2 51.3 51.6 period-end Balances $ 152,015 $ 152,015 Assets $ 132,618 14.6 % $ 132,618 14.6 % 33,219 33,219 Securities, at carrying value 23,428 41.8 23,428 41.8 98,669 98,669 Loans and leases 91,686 7.6 91,686 7.6 98,613 98,613 Deposits 86,766 13.7 86,766 13.7 16,037 16,037 Shareholders’ equity 12,632 27.0 12,632 27.0 23.16 23.16 Book value per common share 23.14 .1 23.14 .1 17.1 % 17.1 % Total capital ratio 14.2 % 14.2 % 9.7 9.7 Leverage capital ratio 7.2 7.2 Average Balances $ 141,555 $ 136,881 Assets $ 131,009 8.0 % $ 126,420 8.3 % 26,573 24,497 Securities, at amortized cost 23,967 10.9 23,311 5.1 97,224 95,195 Loans and leases 90,805 7.1 87,952 8.2 91,986 88,831 Deposits 85,260 7.9 83,501 6.4 14,924 13,495 Shareholders’ equity 12,655 17.9 12,166 10.9 Asset quality ratios 1.34 % 1.34 % Nonperforming assets as a percentage of total assets .52 % .52 % Annualized net charge-offs as a percentage 1.29 .89 of average loans and leases .48 .38 1 Based on earnings available to common shareholders. 2 Excludes securities gains (losses), foreclosed property expense, increases or decreases in the valuation of mortgage servicing rights, and gains or losses on mortgage servicing rights-related derivatives. Operating and cash basis ratios also exclude merger-related and restructuring charges or credits and nonrecurring items. 3 Operating earnings exclude the effect on net income of merger-related and restructuring charges or credits and nonrecurring items, which totaled $(41 million) and $4 million, net of tax, for the fourth quarters of 2008 and 2007, respectively, and $(122 million) and $15 million, net of tax, for 2008 and 2007, respectively. 4 Cash basis operating results exclude the unamortized balances of intangibles from assets and shareholders’ equity and exclude the effects of amortization of intangible assets and net amortization of purchase accounting mark-to-market adjustments, which totaled $14 million and $17 million, net of tax, for the fourth quarters of 2008 and 2007, respectively, and $62 million and $67 million, net of tax, for 2008 and 2007, respectively. View slide