Slide 1: Fourth Quarter 2010 Earnings Conference Call
Fourth Quarter 2010 Earnings Conference Call January 21, 2011 Kelly S. King Chairman and Chief Executive Officer Daryl N. Bible Chief Financial Officer Clarke R. Starnes Chief Risk Officer
Slide 2: Forward-Looking Information
Forward-Looking Information This presentation contains certain forward-looking statements with respect to the financial condition, results of operations and businesses of BB&T. Statements that are not historical or current to facts or statements about beliefs and expectations are forward-looking sta
Slide 3: Non-GAAP Information
Non-GAAP Information This presentation contains financial information 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 perform
Slide 4: 2010 Fourth Quarter Highlights
2010 Fourth Quarter Highlights Record annual revenues Strong improvement in earnings 4Q10 net income available to common shareholders of $208 million, up 12.4% compared to 4Q09 4Q10 EPS totals $.30, up 11.1% compared to 4Q09 2010 net income available to common shareholders of $816 million,
Slide 5: Items Affecting Quarterly Earnings
Items Affecting Quarterly Earnings $ in millions, except per share amounts Pretax Per share Impact Income (Expense) $991 $.09 Securities gains, net Merger-related charges (4) - Losses and write-downs on loans sold or held for sale in connection with the NPA disposition strategy (62) (.06) 4 1 Net of
Slide 6: Diverse Sources of Revenue and Loan Growth
Diverse Sources of Revenue and Loan Growth C&I vs. CRE mix improvement Mortgage Lending Commercial lending produced a record Strong 4Q originations of $8.4 billion $10.3 billion in the fourth quarter Corporate Banking December was the best closing month for commercial loans in our histor
Slide 7: Overall Loan Growth Accelerated
Overall Loan Growth Accelerated Average Loans Held for Investment Average Loan Growth Highlights1 ($ in billions) ($ in millions) $110 $103.4 4Q10 vs. 3Q10 4Q10 vs. 3Q10 $102.6 $102.3 $102.3 $102.4 $ Annualized % Increase Increase $100 (Decrease) (Decrease) C&I $559 6.9% $90 Other CRE (389) (12.8) S
Slide 8: Driving Positive Mix Change in Deposits
Driving Positive Mix Change in Deposits Average Client Deposits $110.0 $100.0 $90.0 $32.6 $30.8 $22.1 Average Deposit Growth Highlights $28.7 $25.9 $80.0 $70.0 4Q10 vs. 3Q10 ($ in billions) $60.0 Annualized % $50.0 $50.6 $51.7 $50.2 $50.5 $52.6 Increase $40.0 (Decrease) $30.0 $3.7 $3.4 $3.7 $3.9 $3.
Slide 9: Linked Quarter Credit Trends Improve Across the Board
Linked Quarter Credit Trends Improve Across the Board 7.2% Watch list 4.6% NPLs 11.5% Delinquencies 3.5% OREO 9.9% Performing TDRs 4.2% NPAs 10.2% NPL inflows 38.4% Net charge-offs Credit trends improved for all metrics in the resolution cycle 8
Slide 10: Inflow of New Problems Clearly Improving
Inflow of New Problems Clearly Improving Total Loans Past Due and Still Accruing 1,2 ($ in millions) $2,000 7.2% decrease in watch list credits $1,500 Total delinquencies declined $1,663 $1,577 $1,638 11.5% $1,000 $1,488 $1,408 We saw notable improvement in $500 commercial delinquencies, which
Slide 11: Underlying Credit Trends Improved
Underlying Credit Trends Improved 1,2 Total Performing TDRs ($ in millions) Performing TDRs decreased 9.9% linked quarter $2,000 $1,891 $1,715 Performing commercial TDRs $1,639 $1,500 $1,476 decreased 25% $1,070 75% of TDRs are performing $1,000 87% of performing TDRs are current Only 26%
Slide 12: NPAs Decrease for Third Consecutive Quarter
NPAs Decrease for Third Consecutive Quarter Total Nonperforming Assets1 $4,700 $4,500 Continued strong momentum in $4,394 $4,327 NPA disposition strategy $4,300 ($ in millions) $4,172 $4,147 Sold approximately $600 million of $4,100 $3,971 nonperforming assets this quarter $3,900 Average sales
Slide 13: Total Charge-offs Decrease Substantially
Total Charge-offs Decrease Substantially Net Charge-offs / Average Loans 1 3.75% 3.00% 1.74% Total charge-offs decreased 38.4% .08% 2.25% .60% compared to 3Q10 1.50% The quarterly provision essentially 1.98% 1.99% 2.06% 2.07% covered charge-offs in the non- 1.80% 0.75% covered portfolio 0.00%
Slide 14: Net Interest Margin
Net Interest Margin 4.20% 4.12% 4.09% 4.04% 4.00% 3.88% 3.80% The impact on net interest income 3.80% 3.83% related to assets acquired in the Colonial 3.82% 3.75% 3.78% 3.75% transaction was a positive $42 million 3.60% compared to last quarter We also identified additional impairment 3.40% in c
Slide 15: De-Risking of Securities Produces Gains
De-Risking of Securities Produces Gains Securities Book Value Net Gains Yield 4Q10 Purchases $7.6 billion - 1.35% 4Q10 Sales $6.5 billion $99 million1 3.68% 4.19% We have completed a strategic 4.00% de-risking of the investment portfolio We significantly reduced OCI risk in 3.00% light of the ne
Slide 16: Fee Income
Fee Income $ in millions 1 Strong Fee Income Ratio 45.0% 4Q10 v. 4Q10 v. 4Q09 3Q102 Increase Increase 4Q10 (Decrease) (Decrease) 43.0% Noninterest Income 42.3% 41.0% 41.8% 41.2% Insurance income $ 249 (4.2)% (4.7)% 40.8% Service charges on deposits 143 (23.1) (10.8) 39.0% Mortgage banking income 138
Slide 17: Noninterest Expenses and Efficiency
Noninterest Expenses and Efficiency $ in millions 1 60.0% Efficiency Ratio 4Q10 v. 4Q10 v. 4Q09 3Q102 Increase Increase 55.0% 4Q10 (Decrease) (Decrease) 55.3% Noninterest Expense 53.7% 54.1% Personnel expense $ 679 4.5% 22.9% 52.4% 50.0% 51.4% Foreclosed property expense 162 14.1 (11.9) Occupancy an
Slide 18: Capital Among Industry Leaders
Capital Among Industry Leaders1 Tier 1 Common Ratio 9.5% 9.1% 9.0% Capital levels increased during the 9.0% 8.9% fourth quarter 8.5% 8.6% Upon assessment of preliminary 8.5% Basel III requirements, we believe that BB&T will meet the required capital levels 8.0% 4Q09 1Q10 2Q10 3Q10 4Q10 BB&T’s
Slide 19: 2011 Key Drivers
2011 Key Drivers Loans We expect a faster pace of growth in non-real estate loan portfolios with continued declines in commercial real estate, with overall growth of 3%-5% in loans held for investment Deposits Deposits up 1%-3% in total, with double-digit growth in transaction account deposi
Slide 20: BB&T is Well-Positioned for the Future
BB&T is Well-Positioned for the Future The underlying performance of our businesses is strong Our client service metrics are at historic highs C&I loan growth accelerated this quarter Maintaining positive revenue growth in a very challenging environment We expect meaningful declines in cre
Slide 21: Comments Regarding Disclosure
Comments Regarding Disclosure BB&T Corporation does not provide earnings guidance, but does discuss trends regarding the factors that influence potential future performance in both its quarterly earnings release and its quarterly earnings conference call. These statements constitute “forward-looking
Slide 22: Appendix
Appendix
Slide 23: Non-GAAP Capital Measures
Non-GAAP Capital Measures (Dollars in millions) As of / Quarter Ended Dec. 31 Sept. 30 June 30 March 31 Dec. 31 2010 2010 2010 2010 2009 Selected Capital Information 1 Risk-based capital Tier 1 $13,959 $13,828 $13,594 $13,657 $13,456 Total 18,319 18,465 18,327 18,658 18,470 Risk-weighted assets 2 11
Slide 24: Non-GAAP Capital Measures
Non-GAAP Capital Measures (Dollars in millions) As of / Quarter Ended Dec. 31 Sept. 30 June 30 March 31 Dec. 31 2010 2010 2010 2010 2009 Calculations of Tier 1 common equity and tangible assets and related measures: Tier 1 equity $ 13,959 $ 13,828 $ 13,594 $ 13,657 $ 13,456 Less: Qualifying restrict
Slide 25: Non-GAAP Reconciliations
Non-GAAP Reconciliations Quarter Ended Dec. 31 Sept. 30 June 30 March 31 Dec. 31 2010 2010 2010 2010 2009 Efficiency ratio – GAAP 60.9% 57.3% 61.7% 61.2% 58.5% Effect of securities gains (losses), net 2.4 5.6 5.1 (.1) - Effect of merger-related and restructuring charges, net (.2) (.4) (1.6) (.7) (.4
Slide 26: Non-GAAP Reconciliations
Non-GAAP Reconciliations As of / For the Quarter Ended Dec. 31 Sept. 30 June 30 March 31 Dec. 31 2010 2010 2010 2010 2009 Asset Quality Ratios (including amounts related to covered loans and covered foreclosed property)1,2 Loans 30-89 days past due and still accruing as a percentage of total loans a
Slide 27: Non-GAAP Reconciliations
Non-GAAP Reconciliations As of / For the Quarter Ended Dec. 31 Sept. 30 June 30 March 31 Dec. 31 2010 2010 2010 2010 2009 Asset Quality Ratios (excluding amounts related to covered loans and covered foreclosed property)1,2,3 Loans 30-89 days past due and still accruing as a percentage of total loans
Slide 28: BB&T Corporation
Best Bank In Town BB& Since 1872 BB&T Corporation