BB&T produces record annual earnings in 2012; 4th quarter earnings up 29% to $506 million; EPS totals $0.71, up 29%

WINSTON-SALEM, North Carolina, Jan. 17, 2013 /PRNewswire/ -- BB&T Corporation (NYSE: BBT) today reported fourth quarter net income available to common shareholders of $506 million, an increase of 29% compared to $391 million reported in the fourth quarter of 2011. Earnings per diluted common share totaled $0.71, an increase of 29% compared to $0.55 earned in the fourth quarter of last year. The return on average assets increased to 1.20% in the quarter compared with 0.93% in the fourth quarter last year. The return on average common shareholders' equity was 10.5%, up from 8.8% for the same quarter last year.

For 2012, BB&T reported record net income available to common shareholders of $1.9 billion, an increase of 49% compared to $1.3 billion in 2011. For 2012, earnings per diluted common share totaled $2.70 compared with $1.83 per diluted common share earned in 2011. This reflects an increase of 48%.

"2012 was an outstanding year for BB&T," said Chairman and Chief Executive Officer Kelly S. King. "We achieved record net income for the year and accomplished most of our strategic initiatives. Noninterest income grew 23% annually, led by record performances in mortgage banking, insurance and investment banking and brokerage. Our performance benefited from strong improvement in credit costs and more than 6% growth in net interest income. Net interest margin remained strong at 3.84% for the quarter. We are pleased noninterest expenses were essentially flat compared to a year ago even though we added Crump Insurance and BankAtlantic during the year. We were also successful in generating positive operating leverage.

"Despite a challenging environment and seasonal headwinds, average loans held for investment continued to grow. The increase was led by C&I, direct retail and residential mortgage, which were each up more than 5% compared to last quarter on an annualized basis.

"Average deposits increased nearly 10% and noninterest-bearing deposits are up 25% on an annualized basis. The deposit mix also improved, which resulted in interest-bearing deposit costs declining by 18 basis points from the fourth quarter of last year.

"Importantly, we continue to produce broad-based improvement in credit." King said. "Nonperforming assets declined 11% compared to last quarter. This improvement includes a 23% reduction in foreclosed real estate to the lowest level in five years. Net charge-offs, excluding covered loans, were 1.04%, the lowest level in four years.

"I am equally proud we have accomplished our mission in other ways. BB&T's associates won industry-leading recognition for serving our clients and positively influenced the lives of more than 1.6 million people in our communities through our annual Lighthouse Project. We also assumed a leadership role in advocating the importance of the financial services industry to produce a healthier economy."

Fourth Quarter 2012 Performance Highlights

• Average total loans and leases held for investment increased 3.0% on an annualized basis compared to the third quarter of 2012
  • Average C&I loans increased 5.4%
  • Average CRE - other loans increased 7.7%
  • Average direct retail loans increased 6.3%
  • Average residential mortgage loans increased 5.7%
  • Average revolving credit loans increased 8.2%
  • Average residential ADC loans declined 35.3%
• Total revenues for the fourth quarter were $2.5 billion, up 8.0% annualized link quarter
  • Net interest income totaled $1.5 billion, up 5.1% annualized compared to the third quarter of 2012 adjusted for a $26 million benefit for accelerated amortization of hedge gains
  • Noninterest income was $1.0 billion, up 23.5% due to strong mortgage, insurance and investment banking and brokerage results
  • Achieved positive operating leverage
• Average deposits increased $3.1 billion, or 9.5% on an annualized linked quarter basis
  • Average noninterest-bearing deposits increased $1.9 billion, or 24.7%
  • Interest-bearing deposits cost fell 4 basis points to 0.38% this quarter
• Asset quality measures improved significantly
  • Nonperforming assets decreased $182 million, or 10.6% excluding covered assets
  • As a percentage of total assets, nonperforming assets, excluding covered assets, decreased from 0.97% last quarter to 0.85%
  • Net charge-offs, excluding covered loans, totaled 1.04% of average loans for the quarter.
• Capital levels remained strong
  • Tangible common equity was 6.9%
  • Tier 1 common equity was 9.7%
  • Tier 1 risk-based capital was 11.4%
  • Leverage capital was 8.2%
  • Total capital was 14.3%

Earnings presentation and Quarterly Performance Summary

To listen to BB&T's live fourth quarter 2012 earnings conference call at 7:30 a.m. (ET) today, call (888) 632-5009 and enter the participant code 5184622. 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 or by dialing 1-888-203-1112 (access code 4313363) until February 17, 2013.

To access the presentation, including an appendix reconciling non-GAAP disclosures, go to www.BBT.com and click on "About" and proceed to "Investor Relations." The presentation can be found under "View Recent Presentations."

BB&T's Fourth Quarter 2012 Quarterly Performance Summary, which contains detailed financial schedules, is available on BB&T's website at www.BBT.com/financials.html.

About BB&T

As of December 31, 2012, BB&T is one of the largest financial services holding companies in the U.S. with $183.9 billion in assets and market capitalization of $20.4 billion. Based in Winston-Salem, N.C., the company operates approximately 1,830 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 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 and the efficiency of its operations. Management 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. Below is a listing of the types of non-GAAP measures used in this news release:

• 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. The Basel III Tier I common equity ratio is also a non-GAAP measure and reflects management's best estimate of the proposed regulatory requirements, which are subject to change. 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.
• Asset quality ratios have been adjusted to remove the impact of acquired loans and foreclosed property covered by 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.
• Fee income and efficiency ratios are non-GAAP in that they exclude securities gains (losses), foreclosed property expense, amortization of intangible assets, merger-related and restructuring charges, the impact of FDIC loss share accounting and other selected items.
• Return on average tangible common shareholders' equity is a non-GAAP measure that calculates the return on average common shareholders' equity without the impact of intangible assets and their related amortization.

A reconciliation of these non-GAAP measures to the most directly comparable GAAP measure is included on the Investor Relations section of BB&T's website and in BB&T's Fourth Quarter 2012 Quarterly Performance Summary, which is available on BB&T's website at www.BBT.com/financials.html  .

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.