WINSTON-SALEM, N.C.,
April 21, 2016 /CNW/ -- BB&T
Corporation (NYSE: BBT) today reported quarterly earnings for the
first quarter of 2016. Net income available to common shareholders
was $527 million, up 8.0% from the
first quarter of 2015. Earnings per diluted common share were
$0.67 for the first quarter of 2016.
Excluding merger-related and restructuring charges, net income
available to common shareholders was $542
million, or $0.69 per diluted
share.
Net income available to common shareholders was $502 million ($0.64
per diluted share) and $488 million
($0.67 per diluted share) for the
fourth quarter of 2015 and first quarter of 2015, respectively.
"We are pleased to report record net interest income and solid
overall performance for the first quarter," said Chairman and Chief
Executive Officer Kelly S. King.
"Our strategic acquisitions and organic growth have helped us grow
our market share while maintaining low funding costs, and we
achieved positive operating leverage from the fourth quarter.
"Total revenues were $2.6 billion,
up $240 million compared to the first
quarter of 2015," said King. "Strong revenues and excellent expense
control enabled us to achieve solid results for the first
quarter.
"We also successfully completed the acquisitions of National
Penn and Swett & Crawford on April
1st," continued King. "National Penn had 126 financial
centers in Pennsylvania,
New Jersey and Maryland, with approximately $9.6 billion in assets and $6.6 billion in deposits. Swett & Crawford
enhances our wholesale property and casualty insurance business and
adds more than $200 million in annual
revenues. These acquisitions will drive improved efficiencies and
stronger earnings in the future.
"We are also pleased to announce U by BB&T now has more than
1.4 million active users. Since its introduction last October,
we've experienced a rapid adoption rate, particularly from our
younger client base. We are pleased to see clients of all ages
engaging with our free, customizable digital banking platform."
First Quarter 2016 Performance Highlights
- Taxable equivalent revenues were $2.6
billion for the first quarter, up $27
million from the fourth quarter of 2015
- Net interest income was up $26
million
- Net interest margin was 3.43%, up eight basis points
- Fee income ratio was 40.6%, compared to 41.8% for the prior
quarter
- Noninterest expense was $1.5
billion, down $52 million
compared to the fourth quarter
- Other expense decreased $34
million partially due to lower operating charge-offs
- Merger-related and restructuring charges were $27 million lower
- Personnel expense increased $22
million driven by seasonally higher payroll taxes
- The adjusted efficiency ratio was 58.3%, compared to 58.8% in
the prior quarter
- Average loans and leases held for investment were $134.4 billion compared to $134.8 billion for the fourth quarter of 2015;
- Average CRE-income producing properties loans increased 6.9%
annualized
- Average direct retail loans increased 7.8% annualized
- Average dealer floor plan loans increased 25.9% annualized
- Average residential mortgage and sales finance loans decreased
6.2% and 18.5% annualized, respectively
- Average deposits were $149.9
billion compared to $148.5
billion for the prior quarter
- Average noninterest-bearing deposits increased 3.3%
annualized
- Average interest checking deposits increased 24.1%
annualized
- Average interest-bearing deposit costs were 0.25%, up one basis
point
- Deposit mix remained strong, with average noninterest-bearing
deposits representing 30.8% of total deposits, compared to 30.9% in
the prior quarter
- Asset quality remained strong
- Loans 90 days or more past due and still accruing were 0.21% of
loans held for investment, compared to 0.23% in the prior
quarter
- Loans 30-89 days past due and still accruing were 0.61% of
loans held for investment, compared to 0.76% in the prior
quarter
- The allowance for loan and lease losses was 1.10% of loans held
for investment, compared to 1.07% in the prior quarter
- Nonperforming assets increased $191
million during the quarter driven by $206 million in energy-related downgrades (none
were past due at March 31, 2016 or
December 31, 2015)
- The allowance for loan loss coverage ratio was 1.89 times
nonperforming loans held for investment, versus 2.53 times in the
prior quarter
- Capital levels remained strong across the board
- Common equity tier 1 to risk-weighted assets was 10.4%, or
10.2% on a fully phased-in basis
- Tier 1 risk-based capital was 12.2%
- Total capital was 14.6%
- Leverage capital was 10.1%
- Tangible common equity to tangible assets was 7.8%
- Issued perpetual preferred stock for net proceeds of
$451 million
Earnings presentation and Quarterly Performance
Summary
To listen to BB&T's live first quarter 2016 earnings
conference call at 8 a.m. (ET) today,
please call 1-888-632-5009 and enter the participant code 5184622.
A presentation will be used during the earnings conference call and
is available on our website at www.bbt.com. Replays of the
conference call will be available for 30 days by dialing
888-203-1112 (access code 4313363).
The presentation, including an appendix reconciling non-GAAP
disclosures, is available at www.bbt.com.
BB&T's first quarter 2016 Quarterly Performance Summary,
which contains detailed financial schedules, is available on
BB&T's website at www.bbt.com.
About BB&T
As of March 31, 2016, BB&T is one of the largest
financial services holding companies in the U.S. with $212.4 billion in assets and market
capitalization of $26.0 billion.
Based in Winston-Salem, N.C., the
company operates 2,137 financial centers in 15 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 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.
Capital ratios are preliminary. Credit quality data excludes
government guaranteed GNMA 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 related ratios are non-GAAP
measures. The return on average risk-weighted assets is a non-GAAP
measure. BB&T's management uses these measures to assess the
quality of capital and returns relative to balance sheet risk and
believes that investors may find them useful in their analysis of
the Corporation.
- The ratio of loans greater than 90 days and still accruing
interest as a percentage of loans held for investment has been
adjusted to remove the impact of loans that are or were covered by
FDIC loss sharing agreements and purchased credit impaired ("PCI")
loans. Management believes that their inclusion may result in
distortion of these ratios such that they might not be comparable
to other periods presented or to other portfolios that were not
impacted by purchase accounting.
- Adjusted fee income and adjusted 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. BB&T's management uses these measures
in their analysis of the Corporation's performance. BB&T's
management believes these 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.
- 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. This measure is useful for evaluating
the performance of a business consistently, whether acquired or
developed internally.
- Core net interest margin is a non-GAAP measure that adjusts
net interest margin to exclude the impact of interest income and
funding costs associated with loans and securities acquired in the
Colonial acquisition and PCI loans acquired from Susquehanna. Core net interest margin is also
adjusted to remove the purchase accounting marks and related
amortization for non-PCI loans and deposits acquired from
Susquehanna. BB&T's management
believes that the adjustments to the calculation of net interest
margin for certain assets and deposits acquired provide investors
with useful information related to the performance of BB&T's
earning assets.
A reconciliation of these non-GAAP measures to the most
directly comparable GAAP measure is included in BB&T's First
Quarter 2016 Quarterly Performance Summary, which is available on
BB&T's website at www.bbt.com.
This news release contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995, regarding the financial condition, results of operations,
business plans and the future performance of BB&T.
Forward-looking statements are not based on historical facts but
instead represent management's expectations and assumptions
regarding BB&T's business, the economy and other future
conditions. Because forward-looking statements relate to the
future, they are subject to inherent uncertainties, risks and
changes in circumstances that are difficult to predict. BB&T's
actual results may differ materially from those contemplated by the
forward-looking statements. Words such as "anticipates, "believes,"
"estimates," "expects," "forecasts," "intends," "plans,"
"projects," "may," "will," "should," "could," and other similar
expressions are intended to identify these forward-looking
statements. Such statements are subject to factors that could cause
actual results to differ materially from anticipated results. While
there is no assurance that any list of risks and uncertainties or
risk factors is complete, important factors that could cause actual
results to differ materially from those in the forward-looking
statements include the following, without limitation:
- general economic or business conditions, either nationally
or regionally, may be less favorable than expected, resulting in,
among other things, a deterioration in credit quality and/or a
reduced demand for credit, insurance or other services;
- disruptions to the national or global financial markets,
including the impact of a downgrade of U.S. government obligations
by one of the credit ratings agencies and the adverse effects of
recessionary conditions in Europe
and the impact of recent market disruptions in China;
- changes in the interest rate environment, including interest
rate changes made by the Federal Reserve, and cash flow
reassessments may reduce NIM and/or the volumes and values of loans
made or held as well as the value of other financial assets
held;
- competitive pressures among depository and other financial
institutions may increase significantly;
- legislative, regulatory or accounting changes, including
changes resulting from the adoption and implementation of the
Dodd-Frank Act may adversely affect the businesses in which
BB&T is engaged;
- local, state or federal taxing authorities may take tax
positions that are adverse to BB&T;
- a reduction may occur in BB&T's credit ratings;
- adverse changes may occur in the securities
markets;
- competitors of BB&T may have greater financial resources
or develop products that enable them to compete more successfully
than BB&T and may be subject to different regulatory standards
than BB&T;
- cyber-security risks, including "denial of service,"
"hacking" and "identity theft," could adversely affect our business
and financial performance or our reputation, and we could be liable
for financial losses incurred by third parties due to breaches of
data shared between financial institutions;
- natural or other disasters, including acts of domestic or
foreign terrorism, could have an adverse effect on BB&T in that
such events could materially disrupt BB&T's operations or the
ability or willingness of BB&T's customers to access the
financial services BB&T offers;
- costs related to the integration of the businesses of
BB&T and its merger partners may be greater than
expected;
- failure to execute on strategic or operational plans,
including the ability to successfully complete and/or integrate
mergers and acquisitions or fully achieve expected cost savings or
revenue growth associated with mergers and acquisitions within the
expected time frames could adversely impact financial condition and
results of operations;
- significant litigation could have a material adverse effect
on BB&T;
- unfavorable resolution of legal proceedings or other claims
and regulatory and other governmental investigations or other
inquiries could result in negative publicity, protests, fines,
penalties, restrictions on BB&T's operations or ability to
expand its business and other negative consequences, all of which
could cause reputational damage and adversely impact BB&T's
financial conditions and results of operations;
- deposit attrition, customer loss and/or revenue loss
following completed mergers and acquisitions may be greater than
expected;
- higher than expected costs related to information technology
infrastructure or a failure to successfully implement future system
enhancements could adversely impact BB&T's financial condition
and results of operations and could result in significant
additional costs to BB&T; and
- widespread system outages, caused by the failure of critical
internal systems or critical services provided by third parties,
could adversely impact BB&T's financial conditions and results
of operations.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
report. Actual results may differ materially from those expressed
in or implied by any forward-looking statement. Except to the
extent required by applicable law or regulation, BB&T
undertakes no obligation to revise or update publicly any
forward-looking statements for any reason.
SOURCE BB&T Corporation