DOW JONES NEWSWIRES
BB&T Corp.'s (BBT) third-quarter earnings fell 58% on a big
jump in credit-loss provisions as the Mid-Atlantic and Southeast
regional bank took over a failed rival.
Regarded as one of the most-stable regional banks, BB&T has
strengthened its capital base in August with a $963 million
offering of common stock after it purchased most of the assets and
all the deposits of failed Colonial BancGroup Inc.
However, it hasn't been immune to the problems plaguing the rest
of the industry, and Monday the company said nonperforming assets,
or loans in danger of going bad, continued to rise.
In June, the bank was among the first to pay back $3.1 billion
it had received from the Treasury Department's Troubled Asset
Relief Program.
BB&T company posted a profit of $152 million, or 23 cents a
share, compared with a profit of $358 million, or 65 cents a share,
a year earlier. It had 24% more shares outstanding a year ago. A
survey of analysts by Thomson Reuters predicted a profit of 22
cents a share.
Interest income decreased 2.5% to $1.8 million.
Credit-loss provisions soared 95% to $709 million from $364
million a year earlier, and rose from the second quarter's $701
million. Nonperforming assets, or loans in danger of going bad,
rose to 2.48% from 1.2% a year earlier and 2.19% from the previous
quarter. Net charge-offs, loans the bank doesn't expect to collect,
rose to 1.71% from 1% last year but fell from 1.81% last
quarter.
BB&T's tangible common equity ratio, which measures how much
of a bank's hard assets it common shareholder actually own, rose to
6.1% from 5.8% a year earlier but fell from 6.5% in the previous
quarter.
Average client deposits were up 20% from a year earlier amid the
Colonial takeover, while average loans and leases held for
investment saw a 6% increase.
BB&T shares closed Friday at $28.25 and weren't active
premarket Monday. The stock is up slightly so far this year.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com