BB&T posts EPS of $0.52, up 73%; Net income increases 69%

WINSTON-SALEM, North Carolina, October 20, 2011 /PRNewswire/ --

Average total loans up an annualized 4%

Nonperforming assets 11% lower

BB&T Corporation (NYSE: BBT) today reported third quarter net income of $371 million, an increase of 69% compared to $219 million reported in the third quarter last year. Net income available to common shareholders was $366 million, or $0.52 per diluted common share, compared with $210 million, or $0.30 per diluted common share, earned in the third quarter of 2010. These results reflect increases of 74% and 73%, respectively.

"We are very pleased to report our strongest earnings quarter in three years," said Chairman and Chief Executive Officer Kelly S. King. "The increase was driven by significantly improved credit quality and improved net interest income. Net revenues totaled $2.1 billion this quarter, led by taxable-equivalent net interest income of $1.5 billion, up 8% compared to last year.

"BB&T also posted very healthy, broad-based loan growth," King said. "BB&T's average loans held for investment grew an annualized 4%, and, excluding our covered and residential ADC portfolios, increased an annualized 7%.  Further, all our leading indicators for loan growth are positive, with robust pipelines and solid momentum as we enter the fourth quarter.

"We continue to see impressive growth rates in low-cost deposits and to improve our deposit mix," King said. "Average deposits increased 32% on an annualized basis compared to the second quarter, and noninterest-bearing deposits and interest checking increased 22% and 14%, respectively. We have reduced the average cost of interest-bearing deposits from 0.72% last quarter to 0.65% this quarter."

"We have reduced nonperforming assets by approximately $900 million in the last two quarters to the lowest level in two and a half years.  We continue to make meaningful progress in all credit areas," King said. "In particular, nonperforming assets decreased 11% in the quarter and inflows of new nonperforming assets decreased 12%.

"Finally, our net interest margin remained a very strong 4.09% in the third quarter compared to 4.15% last quarter," King said. "The slight reduction results mainly from securities being a larger percentage of earning assets."

Third Quarter 2011 Performance Highlights

• Average total loans and leases held for investment increased 4.3% on an annualized basis compared to the second quarter
  • Average C&I loans increased 7.5%
  • Average loans in the specialized lending group increased 30.8%
  • Average mortgage loans increased 11.0%
  • Average sales finance loans increased 2.8%
  • Average revolving credit loans increased 7.5%
  • Average direct retail loans increased 3.6%
  • Average total loans held for investment, excluding the impact of ADC and covered and other acquired loan runoff, increased 7.4%
  • Average residential ADC loans declined 48.3%

• The net interest margin remained strong
  • The net interest margin was 4.09% for the third quarter, flat compared to the third quarter of 2010 and down 6 basis points compared to last quarter

• The pace of improvement in problem assets remained strong in the quarter
  • NPAs decreased 11.5% excluding covered assets, the 6th consecutive quarter with lower NPAs
  • Performing TDRs, excluding government guaranteed loans, decreased 9.4%
  • NPA inflows decreased 12.1%
  • Loans 90 days or more past due and still accruing interest decreased 7.9%, excluding covered and government guaranteed loans
  • Loans 30-89 days past due and still accruing increased 5.7% due to seasonal factors in the specialized lending and mortgage portfolios
  • Net charge-offs totaled 1.44% of average loans for the quarter, excluding covered loans, down from 1.80% last quarter

• Average deposits increased $8.6 billion, or 32.0% on an annualized linked quarter basis
  • Average noninterest-bearing deposits increased $1.2 billion, or 21.8%
  • Average interest checking deposits increased $667 million, or 14.4%
  • Average money market and savings deposits were up $2.8 billion, or 28.1%
  • Average certificates and other time deposits increased $4.2 billion, or 63.6%
  • Average interest-bearing deposit costs were reduced to 0.65% compared to 0.72% in the second quarter

• Capital levels further improved during the quarter
  • Tangible common equity remained strong at 7.1%
  • Tier 1 common equity improved to 9.8%
  • Tier 1 risk-based capital improved to 12.5%
  • Leverage capital remained strong at 9.2%
  • Total capital remained strong at 16.1%

BB&T Insurance Services expands through two acquisitions

During the quarter, BB&T expanded its insurance operations through the acquisition of Liberty Benefit Insurance Services of San Jose, California. Liberty is a full-service employee benefits broker that partners with large commercial clients to help them manage rising health care costs, changing regulations and complex benefits administration.

BB&T also entered into the metro Baltimore area through the acquisition of Atlantic Risk Management Corporation of Columbia, Md. Atlantic Risk Management is a commercial property and casualty and employee benefits broker that provides risk management consulting and a full array of business insurance products and services.

Earnings webcast, presentation and Quarterly Performance Summary

To hear a live webcast of BB&T's third quarter 2011 earnings conference call at 8 a.m. (ET) today, please visit our website at http://www.BBT.com. A presentation will be used during the earnings conference call and is available on our website. Replays of the conference call will be available on the BB&T website until Friday, Nov. 4, 2011, or by dialing 1-888-203-1112 (access code 4313363) until Oct. 25, 2011.

To access the webcast and presentation, including an appendix reconciling non-GAAP disclosures, go to http://www.BBT.com and click on "About BB&T" and proceed to "Investor Relations." The webcast link can be found under "Webcasts" and the presentation can be found under "View Recent Presentations."

BB&T's third quarter 2011 Quarterly Performance Summary, which contains detailed financial schedules, is available on BB&T's website at http://www.BBT.com/financials.html.

About BB&T

As of September 30, 2011, BB&T is one of the largest financial services holding companies in the U.S. with $168 billion in assets and market capitalization of $14.9 billion. Based in Winston-Salem, N.C., the company operates approximately 1,800 financial centers in 12 states and Washington, D.C., and offers a full range of consumer and commercial banking, securities brokerage, asset management, mortgage and insurance products and services. A Fortune 500 company, BB&T is consistently recognized for outstanding client satisfaction by J.D. Power and Associates, the U.S. Small Business Administration, Greenwich Associates and others. More information about BB&T and its full line of products and services is available at http://www.BBT.com.

Current quarter capital ratios are preliminary. Credit quality data excludes covered and government guaranteed loans where applicable.

This news release contains financial information and performance measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). BB&T's management uses these "non-GAAP" measures in their analysis of the corporation's performance. BB&T's management uses these measures to evaluate the underlying performance and efficiency of its operations. It believes that these non-GAAP measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods as well as demonstrating the effects of significant gains and charges in the current period. The company believes that a meaningful analysis of its financial performance requires an understanding of the factors underlying that performance. BB&T's management believes that investors may use these non-GAAP financial measures to analyze financial performance without the impact of unusual items that may obscure trends in the company's underlying performance. These disclosures should not be viewed as a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Tangible common equity and Tier 1 common equity ratios are non-GAAP measures. BB&T uses the Tier 1 common equity definition used in the SCAP assessment to calculate these ratios. BB&T's management uses these measures to assess the quality of capital and believes that investors may find them useful in their analysis of the corporation. These capital measures are not necessarily comparable to similar capital measures that may be presented by other companies. Asset quality ratios have been adjusted to remove the impact of acquired loans and foreclosed property covered by the FDIC loss sharing agreements as management believes their inclusion results in distortion of those ratios and may not be comparable to other periods presented or to other portfolios that were not impacted by purchase accounting.

This news release contains certain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Actual results may differ materially from current projections. Please refer to BB&T's filings with the Securities and Exchange Commission for a summary of important factors that may affect BB&T's forward-looking statements. BB&T undertakes no obligation to revise these statements following the date of this news release.