BBT BB and T Corporation

By Austen Hufford 

BB&T Corp. said profit and revenue rose in its latest quarter as recent acquisition costs diminished but took a charge related to the increase in interest rates.

The Winston-Salem, N.C.-based lender reported earnings of $643 million, up from $542 million a year earlier. Per-share profit grew to 72 cents from 64 cents as the number of shares outstanding rose 4%. Excluding merger costs and other items, earnings per share were 73 cents.

Total revenue for the fourth quarter, which is a combination of net interest income and fee-based income, grew 8.3% to $2.73 billion.

Analysts polled by Thomson Reuters had expected adjusted profit of 73 cents a share on $2.79 billion in revenue.

Chief Executive Kelly King said higher interest rates created $34 million in pretax charges but that revenue growth was strong and the bank controlled expenses.

In December the Federal Reserve approved its second rate increase in a decade and signaled that interest rates would rise at a faster pace than previously projected.

"We are well-positioned for future interest rate increases," Mr. King said Thursday.

Fee-based income rose 14% to $1.16 billion on increased insurance and investment banking and brokerage fees. Net interest income rose 4.1% to $1.57 billion.

Expenses rose 4.4%, driven by higher personnel costs that were partially offset by a reduction in merger-related charges.

In recent quarters the regional bank has made a number of deals including a $1.8 billion purchase of Pennsylvania-based National Penn Bancshares Inc. and its $500 million deal to acquire U.S. wholesale insurance broker Swett & Crawford. Merger costs fell to $13 million from $50 million last year.

Taxable equivalent net interest margin, a key profitability measure, fell to 3.32% from 3.39% a quarter before and 3.35% a year before.

BB&T set aside $129 million for credit losses, the same as in the fourth quarter last year.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

January 19, 2017 07:15 ET (12:15 GMT)

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