UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
July 11, 2002
Date of Report (Date of earliest event reported)
BB&T Corporation
(Exact name of registrant as specified in its charter)
Commission file number : 1-10853
| North Carolina | 56-0939887 |
| (State of incorporation) | (I.R.S. Employer Identification No.) |
| 200 West Second Street | |
| Winston-Salem, North Carolina | 27101 |
| (Address of principal executive offices) | (Zip Code) |
(336) 733-2000
(Registrant's telephone number, including area code)
This Form 8-K has 14 pages.
ITEM 9. REGULATION FD DISCLOSURE
The purpose of this Current Report on Form 8-K is to file BB&T Corporation's Quarterly Performance Summary for the second quarter of 2002.
EXHIBIT INDEX
Exhibit 99.1 Quarterly Performance Summary issued July 11, 2002
July 11, 2002
FOR IMMEDIATE RELEASE
| Contacts: | ||
| ANALYSTS | MEDIA | |
| Tom A. Nicholson | Scott E. Reed | Bob Denham |
| Senior Vice President | Sr. Exec. Vice President | Senior Vice President |
| Investor Relations | Chief Financial Officer | Public Relations |
| (336) 733-3058 | (336) 733-3088 | (336) 733-1002 |
BB&T achieves 23.0% increase in 2nd quarter earnings
WINSTON-SALEM, N.C. — BB&T Corporation (NYSE:BBT) reported today record earnings for the second quarter of 2002 totaling $329.0 million, or $.68 per diluted share, excluding merger-related charges. These earnings reflect an increase of 23.0% compared with prior year earnings, which totaled $267.4 million. Diluted earnings per share for the current quarter increased 17.2% compared with $.58 earned during the second quarter of 2001.
The merger-related charges, which totaled $1.1 million, resulted from the acquisitions of AREA Bancshares Corporation and MidAmerica Bancorp and costs associated with systems conversions related to previously completed acquisitions.
BB&T’s second quarter 2002 results, excluding merger-related charges, produced an annualized return on average assets of 1.75% and an annualized return on average shareholders’ equity of 18.44%, compared with prior year ratios of 1.58% and 18.95%, respectively.
Cash basis operating results exclude the effects of intangible assets and related amortization expenses. Excluding merger-related charges, cash basis earnings totaled $332.9 million for the second quarter of 2002, or $.69 per diluted share. These results reflect increases of 16.7% in cash basis earnings and 11.3% in cash basis diluted earnings per share compared with results for the second quarter of 2001. Cash basis earnings for the current quarter produced an annualized return on average tangible assets of 1.81%, and an annualized return on average tangible shareholders’ equity of 23.94%.
Including merger-related charges, net income for the second quarter of 2002 totaled $328.0 million compared with $237.2 million earned in the second quarter of 2001, an increase of 38.2%. On a diluted per share basis, net income for the quarter was $.68, up 30.8% compared with $.52 earned in the comparable period in 2001. Net income for the second quarter generated an annualized return on average assets of 1.74% and an annualized return on average shareholders’ equity of 18.38% compared with prior year ratios of 1.40% and 16.81%, respectively. For the first six months of 2002, net income totaled $637.6 million, an increase of 34.6% compared with $473.7 million earned in the first half of 2001. On a diluted per share basis, earnings were $1.34, up 30.1% compared with last year.
“I am pleased to report healthy earnings for the second quarter,” said Chairman and Chief Executive Officer John A. Allison. “The primary drivers of our performance continue to be strong growth in noninterest sources of income, an effective merger and acquisition strategy, and careful control of noninterest expenses. We are also encouraged that our asset quality indicators improved compared with the first quarter.”
For the first six months of 2002, BB&T’s earnings were $638.2 million, or $1.34 per diluted share, excluding $10.4 million of after-tax merger-related charges and $9.8 million of net income resulting from the implementation of a new accounting principle during the first quarter. These earnings reflect increases of 20.7% and 16.5%, respectively, compared with 2001. Earnings for the six months ended June 30, excluding merger-related charges and the impact of the new accounting standard, yielded an annualized return on average assets of 1.75% and an annualized return on average shareholders’ equity of 18.89%, compared with prior year ratios of 1.58% and 19.13%, respectively.
BB&T Recognized as One of the Nation’s Best Banks
During the second quarter, BB&T received high praise from a number of highly regarded financial publications and organizations for industry leading growth and performance. In its special annual issue (Spring 2002) highlighting the top performing companies,Business Week ranked BB&T as the third highest performing bank in the country and the 81st best performer of all S&P 500 companies. In its May 2002 issue,SmartMoneymagazine rated BB&T as one of its“Five Worthy Income Stocks.” Also,Barron’s, in its April 22 edition, ranked BB&T as the second highest performing bank and the 17th highest performing company among the nation’s 500 largest companies – the top 4%. Finally, Standard & Poor’s raised BB&T’s debt ratings across the board during the quarter citing BB&T’s “solid track record of strong earnings, good asset quality, and comfortable capital levels while building a multistate franchise …"
“We are very pleased to compare so favorably to our peers,” said Allison. “These independent studies consider a wide range of performance criteria and the highest ranking institutions must perform well in all areas and consistently over the long-term. This recognition provides further indications that we are achieving our objectives.”
BB&T Declares 11.5% Increase in Dividend; Receives Recognition
On June 25, BB&T’s board of directors approved an 11.5% increase in the quarterly cash dividend paid to shareholders. The increase, to $.29 per share, marks the 31st consecutive year that BB&T has raised its cash dividend to shareholders. In addition, BB&T has paid a dividend every year since 1920. In recognition of this outstanding track record, BB&T was named a 2002 “Dividend Achiever” by Mergent, a provider of global financial information. Fewer than 3% of the more than 11,000 companies reviewed by Mergent received this recognition.
Earnings Growth Led by 21.1% Increase in Noninterest Income
Total noninterest income was $404.1 million for the second quarter of 2002, an increase of 21.1% compared with the same period in 2001. This increase was primarily driven by service charges on deposits, investment banking and brokerage fees and commissions and agency insurance commissions.
Income from service charges on deposit accounts totaled $101.5 million for the second quarter, an increase of 15.3% compared with the same period in 2001. This increase resulted from growth in deposit accounts, higher transaction volume and income from acquisitions.
Investment banking and brokerage fees and commissions totaled $56.0 million for the quarter, an increase of 30.6% compared with the second quarter last year. This increase resulted from substantially higher revenues generated by fixed income underwriting fees, as well as increased trading income and retail brokerage fees. BB&T Investment Services, Inc. received the inaugural “Program of the Year” award given by the Bank Securities Association. The award recognized BB&T as the No. 1 regional bank brokerage program in the nation.
BB&T’s insurance operations continued to enjoy solid growth in commission income. Commissions from insurance operations totaled $74.1 million in the second quarter of 2002, up 64.4% compared with the second quarter last year. This significant increase reflects the Jan. 1 purchase of CRC Insurance Services, Inc., BB&T’s wholesale insurance brokerage subsidiary, as well as acquisitions of other agencies in 2002 and 2001. BB&T’s insurance agency network also realized internal commission income growth of approximately 14% during the quarter.
Excluding the effect of acquisitions accounted for as purchases, noninterest income totaled $363.4 million for the quarter, reflecting an increase of 8.9% compared with the same period in 2001.
Nonperforming Assets and Loan Losses Decline
BB&T’s asset quality measurements improved compared with the first quarter of 2002. Nonperforming assets as a percentage of total assets were .52% at June 30, down from .56% at the end of the first quarter of 2002. Annualized net charge-offs were .46% of average loans and leases for the second quarter of 2002, compared with .48% in the first quarter of 2002. Excluding losses at BB&T’s specialized lending subsidiaries, annualized net charge-offs for the quarter were .38% of average loans and leases.
Expense Control Remains a Strength for BB&T
Noninterest expenses, excluding merger-related charges, totaled $575.3 million for the second quarter, up 12.9% compared with the same period last year. Excluding expense growth from acquisitions, BB&T’s noninterest expense increased only 1.4%. BB&T’s cash basis efficiency ratio was 50.4% for the current quarter.
BB&T Has Active Quarter for Mergers and Acquisitions
On May 22, BB&T announced plans to acquire Regional Financial Corp., and its banking subsidiary, First South Bank, of Tallahassee, Fla. The acquisition marks BB&T’s initial entry into some of Florida’s most economically attractive markets and provides BB&T with a solid presence in one of the nation’s fastest growing states. With $1.6 billion in assets, First South Bank operates 11 full-service retail branches, three limited service branches, and eight mortgage loan production offices in Tallahassee and the Florida Panhandle, Jacksonville, and along the Gulf Coast from Beverly Hills to Naples.
On April 9, BB&T completed its acquisition of The Pfefferkorn Company, a mortgage banking company based in Winston-Salem, N.C. The acquisition increased BB&T’s mortgage servicing portfolio by $840 million and increased annual mortgage originations by more than $100 million.
On April 30, BB&T acquired Virginia Investment Counselors, Inc., an investment advisory firm with $1.2 billion in assets under management based in Norfolk, Va. The acquisition substantially expands BB&T’s asset management capabilities.
On June 19, BB&T announced plans to acquire New York City-based American Marketing Center, Inc., a wholesale insurance broker specializing in real estate products. The acquisition will significantly expand BB&T’s wholesale insurance operations in very strong markets.
On May 1, plans were announced to acquire Benefit Consultants, an employee benefits company based in Richmond, Va. On July 1, BB&T completed its acquisition of Hunt, DuPree, Rhine & Associates, Inc., an employee benefits and investment advisory firm based in Greenville, S.C. These acquisitions will enhance BB&T’s product line of employee benefits and related services.
In addition to the mergers and acquisitions described above, BB&T completed the systems integration of Community First Banking Company, of Carrollton, Ga., during the second quarter.
At June 30, BB&T had $76.3 billion in assets and operated 1,122banking offices in the Carolinas, Virginia, West Virginia, Kentucky, Georgia, Maryland, Tennessee, Alabama, Indiana and Washington, D.C. BB&T’s common stock is traded on the New York Stock Exchange under the trading symbol BBT. The closing price of BB&T’s common stock on July 10 was $36.53 per share.
For additional information about BB&T’s financial performance, company news, and products and services, please visit our web site atwww.BBandT.com.
To hear a live webcast of BB&T’s second quarter 2002 earnings conference call at 10 a.m. today, please visit our web site atwww.BBandT.com. Replays of the conference call will be available through our web site until 5 p.m. (EDT) July 26.
#
_________________
This press release contains forward-looking statements as defined by federal securities laws. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Actual results could 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 could affect BB&T’s forward-looking statements. BB&T undertakes no obligation to revise these statements following the date of this press release.
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 5 | Investor Relations | FAX (336) 733-3132 |
| For the Three Months Ended | Increase (Decrease) | ||||||||||||||
| (Dollars in thousands, except per share data) | 6/30/02 | 6/30/01 | $ | % | |||||||||||
| INCOME STATEMENT EXCLUDING MERGER-RELATED CHARGES (1) | |||||||||||||||
| Interest income - taxable equivalent | $ | 1,159,475 | $ | 1,282,009 | $ | (122,534 | ) | (9.6 | )% | ||||||
| Interest expense | 432,169 | 633,550 | (201,381 | ) | (31.8 | ) | |||||||||
| Net interest income - taxable equivalent | 727,306 | 648,459 | 78,847 | 12.2 | |||||||||||
| Less: Taxable equivalent adjustment | 37,210 | 53,404 | (16,194 | ) | (30.3 | ) | |||||||||
| Net interest income | 690,096 | 595,055 | 95,041 | 16.0 | |||||||||||
| Provision for loan & lease losses | 58,500 | 44,298 | 14,202 | 32.1 | |||||||||||
| Net interest income after provision for loan & lease losses | 631,596 | 550,757 | 80,839 | 14.7 | |||||||||||
| Noninterest income (2) | 404,067 | 333,599 | 70,468 | 21.1 | |||||||||||
| Noninterest expense (3) | 575,298 | 509,651 | 65,647 | 12.9 | |||||||||||
| Income before income taxes | 460,365 | 374,705 | 85,660 | 22.9 | |||||||||||
| Provision for income taxes | 131,363 | 107,278 | 24,085 | 22.5 | |||||||||||
| Income excluding merger-related charges (1) | 329,002 | 267,427 | 61,575 | 23.0 | |||||||||||
| Merger-related charges, net of tax (1) | 1,050 | 30,198 | (29,148 | ) | NM | ||||||||||
| Net income | $ | 327,952 | $ | 237,229 | $ | 90,723 | 38.2 | % | |||||||
| PER SHARE DATA EXCLUDING MERGER-RELATED CHARGES (1) | |||||||||||||||
| Basic earnings | $ | .69 | $ | .59 | $ | .10 | 16.9 | % | |||||||
| Diluted earnings | .68 | .58 | .10 | 17.2 | |||||||||||
| Weighted average shares - Basic | 478,121,878 | 451,712,342 | |||||||||||||
| Diluted | 484,009,961 | 457,879,467 | |||||||||||||
| Dividends paid on common shares | $ | .26 | $ | .23 | $ | .03 | 13.0 | % | |||||||
| PERFORMANCE RATIOS EXCLUDING MERGER-RELATED CHARGES (1) | |||||||||||||||
| Return on average assets | 1.75 | % | 1.58 | % | |||||||||||
| Return on average equity | 18.44 | 18.95 | |||||||||||||
| Return on average realized equity (4) | 19.08 | 19.74 | |||||||||||||
| Net yield on earning assets (taxable equivalent) | 4.27 | 4.16 | |||||||||||||
| Efficiency (taxable equivalent) (5) | 50.9 | 52.0 | |||||||||||||
| CASH BASIS PERFORMANCE | |||||||||||||||
| EXCLUDING MERGER-RELATED CHARGES (1)(6) | |||||||||||||||
| Earnings excluding merger-related charges | $ | 332,899 | $ | 285,243 | $ | 47,656 | 16.7 | % | |||||||
| Diluted earnings per share | .69 | .62 | .07 | 11.3 | |||||||||||
| Return on average tangible assets | 1.81 | % | 1.72 | % | |||||||||||
| Return on average tangible equity | 23.94 | 24.00 | |||||||||||||
| Return on average realized tangible equity (4) | 25.01 | 24.91 | |||||||||||||
| Efficiency ratio (taxable equivalent) (5) | 50.4 | 50.2 | |||||||||||||
| For the Three Months Ended | Increase (Decrease) | |||||||||||||
| (Dollars in thousands, except per share data) | 6/30/02 | 6/30/01 | $ | % | ||||||||||
| INCOME STATEMENT | ||||||||||||||
| Interest income - taxable equivalent | $ | 1,159,475 | $ | 1,281,421 | $ | (121,946 | ) | (9.5 | )% | |||||
| Interest expense | 432,169 | 633,550 | (201,381 | ) | (31.8 | ) | ||||||||
| Net interest income - taxable equivalent | 727,306 | 647,871 | 79,435 | 12.3 | ||||||||||
| Less: Taxable equivalent adjustment | 37,210 | 53,404 | (16,194 | ) | (30.3 | ) | ||||||||
| Net interest income | 690,096 | 594,467 | 95,629 | 16.1 | ||||||||||
| Provision for loan & lease losses | 58,500 | 48,798 | 9,702 | 19.9 | ||||||||||
| Net interest income after provision for loan & lease losses | 631,596 | 545,669 | 85,927 | 15.7 | ||||||||||
| Noninterest income | 404,067 | 346,667 | 57,400 | 16.6 | ||||||||||
| Noninterest expense | 576,852 | 563,842 | 13,010 | 2.3 | ||||||||||
| Income before income taxes | 458,811 | 328,494 | 130,317 | 39.7 | ||||||||||
| Provision for income taxes | 130,859 | 91,265 | 39,594 | 43.4 | ||||||||||
| Net Income | $ | 327,952 | $ | 237,229 | $ | 90,723 | 38.2 | % | ||||||
| PER SHARE DATA | ||||||||||||||
| Basic earnings | $ | .69 | $ | .53 | $ | .16 | 30.2 | % | ||||||
| Diluted earnings | .68 | .52 | .16 | 30.8 | ||||||||||
| Weighted average shares - Basic | 478,121,878 | 451,712,342 | ||||||||||||
| Diluted | 484,009,961 | 457,879,467 | ||||||||||||
| Dividends paid on common shares | $ | .26 | $ | .23 | $ | .03 | 13.0 | % | ||||||
| PERFORMANCE RATIOS BASED ON NET INCOME | ||||||||||||||
| Return on average assets | 1.74 | % | 1.40 | % | ||||||||||
| Return on average equity | 18.38 | 16.81 | ||||||||||||
| Return on average realized equity (4) | 19.02 | 17.51 | ||||||||||||
| NOTES: | Applicable ratios are annualized. | |
| (1) | Merger-related charges include $1.1 million and $30.2 million in 2002 and 2001, respectively, of net after-tax expenses primarily associated with acquisitions. | |
| (2) | Excluding purchase accounting transactions, noninterest income would have increased $29.8 million, or 8.9%, for the quarter compared to the same period in 2001. | |
| (3) | Excluding purchase accounting transactions, noninterest expense would have increased $7.1 million, or 1.4%, for the quarter compared to the same period in 2001. | |
| (4) | Excludes the effect on average shareholders' equity of unrealized gains (losses) on securities available for sale. | |
| (5) | Excludes securities gains (losses), foreclosed property expense, provisions for the impairment of mortgage servicing rights and merger-related charges. | |
| (6) | Cash basis performance excludes the effect on earnings of amortization expense applicable to intangible assets and the unamortized balances of intangibles from assets and equity. | |
| NM | - not meaningful. |
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 6 | Investor Relations | FAX (336) 733-3132 | |||
| For the Six Months Ended | Increase (Decrease) | ||||||||||||||
| (Dollars in thousands, except per share data) | 6/30/02 | 6/30/01 | $ | % | |||||||||||
| INCOME STATEMENT EXCLUDING MERGER-RELATED CHARGES (1) | |||||||||||||||
| Interest income - taxable equivalent | $ | 2,279,098 | $ | 2,602,509 | $ | (323,411 | ) | (12.4 | )% | ||||||
| Interest expense | 866,530 | 1,319,645 | (453,115 | ) | (34.3 | ) | |||||||||
| Net interest income - taxable equivalent | 1,412,568 | 1,282,864 | 129,704 | 10.1 | |||||||||||
| Less: Taxable equivalent adjustment | 75,200 | 102,355 | (27,155 | ) | (26.5 | ) | |||||||||
| Net interest income | 1,337,368 | 1,180,509 | 156,859 | 13.3 | |||||||||||
| Provision for loan & lease losses | 115,000 | 77,468 | 37,532 | 48.4 | |||||||||||
| Net interest income after provision for loan & lease losses | 1,222,368 | 1,103,041 | 119,327 | 10.8 | |||||||||||
| Noninterest income | 778,787 | 639,480 | 139,307 | 21.8 | |||||||||||
| Noninterest expense | 1,108,989 | 994,293 | 114,696 | 11.5 | |||||||||||
| Income before income taxes | 892,166 | 748,228 | 143,938 | 19.2 | |||||||||||
| Provision for income taxes | 253,917 | 219,356 | 34,561 | 15.8 | |||||||||||
| Income excluding merger-related charges (1) | 638,249 | 528,872 | 109,377 | 20.7 | |||||||||||
| Merger-related charges, net of tax (1) | 652 | 55,143 | (54,491 | ) | NM | ||||||||||
| Net income | $ | 637,597 | $ | 473,729 | $ | 163,868 | 34.6 | % | |||||||
| PER SHARE DATA EXCLUDING MERGER-RELATED CHARGES (1) | |||||||||||||||
| Basic earnings | $ | 1.36 | $ | 1.17 | $ | .19 | 16.2 | % | |||||||
| Diluted earnings | 1.34 | 1.15 | .19 | 16.5 | |||||||||||
| Weighted average shares - Basic | 470,554,054 | 452,171,070 | |||||||||||||
| Diluted | 476,349,694 | 458,649,989 | |||||||||||||
| Dividends paid on common shares | $ | .52 | $ | .46 | $ | .06 | 13.0 | % | |||||||
| PERFORMANCE RATIOS EXCLUDING MERGER-RELATED CHARGES (1) | |||||||||||||||
| Return on average assets | 1.75 | % | 1.58 | % | |||||||||||
| Return on average equity | 18.89 | 19.13 | |||||||||||||
| Return on average realized equity (4) | 19.66 | 19.82 | |||||||||||||
| Net yield on earning assets (taxable equivalent) | 4.26 | 4.15 | |||||||||||||
| Noninterest income as a percentage of | |||||||||||||||
| total income (taxable equivalent) (2) | 35.3 | 33.0 | |||||||||||||
| Efficiency (taxable equivalent) (2) | 50.7 | 51.9 | |||||||||||||
| CASH BASIS PERFORMANCE EXCLUDING MERGER-RELATED CHARGES (1)(3) | |||||||||||||||
| Earnings excluding merger-related charges | $ | 644,850 | $ | 563,996 | $ | 80,854 | 14.3 | % | |||||||
| Diluted earnings per share | 1.35 | 1.23 | .12 | 9.8 | |||||||||||
| Return on average tangible assets | 1.80 | % | 1.71 | % | |||||||||||
| Return on average tangible equity | 23.70 | 23.98 | |||||||||||||
| Return on average realized tangible equity (4) | 24.92 | 25.00 | |||||||||||||
| Efficiency ratio (taxable equivalent) (2) | 50.2 | 50.0 | |||||||||||||
| For the Six Months Ended | Increase (Decrease) | |||||||||||||
| (Dollars in thousands, except per share data) | 6/30/02 | 6/30/01 | $ | % | ||||||||||
| INCOME STATEMENT | ||||||||||||||
| Interest income - taxable equivalent | $ | 2,279,098 | $ | 2,601,921 | $ | (322,823 | ) | (12.4 | ) % | |||||
| Interest expense | 866,530 | 1,319,645 | (453,115 | ) | (34.3 | ) | ||||||||
| Net interest income - taxable equivalent | 1,412,568 | 1,282,276 | 130,292 | 10.2 | ||||||||||
| Less: Taxable equivalent adjustment | 75,200 | 102,355 | (27,155 | ) | (26.5 | ) | ||||||||
| Net interest income | 1,337,368 | 1,179,921 | 157,447 | 13.3 | ||||||||||
| Provision for loan & lease losses | 115,000 | 90,818 | 24,182 | 26.6 | ||||||||||
| Net interest income after provision for loan & lease losses | 1,222,368 | 1,089,103 | 133,265 | 12.2 | ||||||||||
| Noninterest income | 778,787 | 678,678 | 100,109 | 14.8 | ||||||||||
| Noninterest expense | 1,125,162 | 1,102,340 | 22,822 | 2.1 | ||||||||||
| Income before income taxes and change in accounting principle | 875,993 | 665,441 | 210,552 | 31.6 | ||||||||||
| Provision for income taxes | 248,176 | 191,712 | 56,464 | 29.5 | ||||||||||
| Income before cumulative effect of change in accounting principle | 627,817 | 473,729 | 154,088 | 32.5 | ||||||||||
| Cumulative effect of change in accounting principle | 9,780 | -- | 9,780 | NM | ||||||||||
| Net income | $ | 637,597 | $ | 473,729 | $ | 163,868 | 34.6 | % | ||||||
| PER SHARE DATA | ||||||||||||||
| Basic earnings | ||||||||||||||
| Income before cumulative effect of change in accounting principle | $ | 1.33 | $ | 1.05 | $ | .28 | 26.7 | % | ||||||
| Cumulative effect of change in accounting principle | .02 | -- | .02 | NM | ||||||||||
| Net income | 1.35 | 1.05 | .30 | 28.6 | ||||||||||
| Diluted earnings | ||||||||||||||
| Income before cumulative effect of change in accounting principle | 1.32 | 1.03 | .29 | 28.2 | ||||||||||
| Cumulative effect of change in accounting principle | .02 | -- | .02 | NM | ||||||||||
| Net income | $ | 1.34 | $ | 1.03 | $ | .31 | 30.1 | % | ||||||
| PERFORMANCE RATIOS | ||||||||||||||
| Return on average assets | 1.75 | % | 1.41 | % | ||||||||||
| Return on average equity | 18.87 | 17.14 | ||||||||||||
| Return on average realized equity (4) | 19.64 | 17.75 | ||||||||||||
| NOTES: | Applicable ratios are annualized. | |
| (1) | Merger-related charges include $10.4 million and $55.1 million in 2002 and 2001, respectively, of net after-tax expense associated with acquisitions, and the cumulative effect of a change in accounting principle, which resulted in the recognition of income | |
| (2) | Excludes securities gains (losses), foreclosed property expense, provisions for the impairment of mortgage servicing rights and merger-related charges for all periods. | |
| (3) | Cash basis operating results exclude the effect on earnings of amortization expense applicable to intangible assets that do not qualify as regulatory capital. Cash basis performance ratios exclude the amortization of nonqualifying intangible assets from earnings and | |
| (4) | Excludes the effect on average shareholders' equity of unrealized gains (losses) on securities available for sale. | |
| NM | - not meaningful. |
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 7 | Investor Relations | FAX (336) 733-3132 | |||
| As of / For the Six Months Ended | Increase (Decrease) | |||||||||||||
| (Dollars in thousands) | ||||||||||||||
| SELECTED BALANCE SHEET DATA | 6/30/02 | 6/30/01 | $ | % | ||||||||||
| End of period balances | ||||||||||||||
| Securities available for sale | $ | 18,076,387 | $ | 15,370,474 | $ | 2,705,913 | 17.6 | |||||||
| Securities held to maturity | 47,366 | 308,846 | (261,480 | ) | (84.7 | ) | ||||||||
| Trading securities | 132,305 | 120,381 | 11,924 | 9.9 | ||||||||||
| Total securities | 18,256,058 | 15,799,701 | 2,456,357 | 15.5 | ||||||||||
| Commercial loans & leases | 28,375,721 | 25,102,074 | 3,273,647 | 13.0 | ||||||||||
| Consumer loans | 12,355,759 | 11,228,486 | 1,127,273 | 10.0 | ||||||||||
| Revolving credit loans | 986,145 | 892,969 | 93,176 | 10.4 | ||||||||||
| Mortgage loans | 8,812,309 | 9,803,743 | (991,434 | ) | (10.1 | ) | ||||||||
| Total loans & leases | 50,529,934 | 47,027,272 | 3,502,662 | 7.4 | ||||||||||
| Allowance for loan & lease losses | 706,446 | 610,171 | 96,275 | 15.8 | ||||||||||
| Other earning assets | 330,555 | 506,263 | (175,708 | ) | (34.7 | ) | ||||||||
| Total earning assets | 68,638,124 | 62,923,591 | 5,714,533 | 9.1 | ||||||||||
| Total assets | 76,333,441 | 68,811,370 | 7,522,071 | 10.9 | ||||||||||
| Noninterest-bearing deposits | 7,625,530 | 6,419,145 | 1,206,385 | 18.8 | ||||||||||
| Savings & interest checking | 3,290,255 | 3,263,459 | 26,796 | .8 | ||||||||||
| Money rate savings | 14,632,630 | 12,768,711 | 1,863,919 | 14.6 | ||||||||||
| CDs and other time deposits | 25,360,774 | 22,499,458 | 2,861,316 | 12.7 | ||||||||||
| Total deposits | 50,909,189 | 44,950,773 | 5,958,416 | 13.3 | ||||||||||
| Short-term borrowed funds | 4,930,434 | 5,704,614 | (774,180 | ) | (13.6 | ) | ||||||||
| Long-term debt | 10,979,492 | 10,864,249 | 115,243 | 1.1 | ||||||||||
| Total interest-bearing liabilities | 59,193,585 | 55,100,491 | 4,093,094 | 7.4 | ||||||||||
| Total shareholders' equity | $ | 7,128,356 | $ | 5,855,699 | $ | 1,272,657 | 21.7 | |||||||
| Average balances | ||||||||||||||
| Securities, at amortized cost | $ | 17,040,636 | $ | 15,641,844 | $ | 1,398,792 | 8.9 | % | ||||||
| Commercial loans & leases | 27,264,357 | 24,870,520 | 2,393,837 | 9.6 | ||||||||||
| Consumer loans | 11,778,339 | 11,067,317 | 711,022 | 6.4 | ||||||||||
| Revolving credit loans | 957,074 | 861,797 | 95,277 | 11.1 | ||||||||||
| Mortgage loans | 9,056,119 | 9,061,024 | (4,905 | ) | (.1 | ) | ||||||||
| Total loans & leases | 49,055,889 | 45,860,658 | 3,195,231 | 7.0 | ||||||||||
| Other earning assets | 404,904 | 466,111 | (61,207 | ) | (13. | 1) | ||||||||
| Total earning assets | 66,501,429 | 61,968,613 | 4,532,816 | 7.3 | ||||||||||
| Total assets | 73,521,039 | 67,524,431 | 5,996,608 | 8.9 | ||||||||||
| Noninterest-bearing deposits | 6,826,917 | 5,969,416 | 857,501 | 14.4 | ||||||||||
| Savings & interest checking | 3,385,771 | 3,447,388 | (61,617 | ) | (1.8 | ) | ||||||||
| Money rate savings | 14,171,994 | 12,065,884 | 2,106,110 | 17.5 | ||||||||||
| CDs and other time deposits | 23,146,738 | 22,293,957 | 852,781 | 3.8 | ||||||||||
| Total deposits | 47,531,420 | 43,776,645 | 3,754,775 | 8.6 | ||||||||||
| Short-term borrowed funds | 5,860,857 | 6,085,596 | (224,739 | ) | (3.7 | ) | ||||||||
| Long-term debt | 11,427,259 | 10,721,715 | 705,544 | 6.6 | ||||||||||
| Total interest-bearing liabilities | 57,992,619 | 54,614,540 | 3,378,079 | 6.2 | ||||||||||
| Total shareholders' equity | $ | 6,814,741 | $ | 5,573,836 | $ | 1,240,905 | 22.3 | |||||||
| As of / For the Quarter Ended | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) | 6/30/02 | 3/31/02 | 12/31/01 | 9/30/01 | 6/30/01 | |||||||||||||||
| MISCELLANEOUS INFORMATION (1) | ||||||||||||||||||||
| Unrealized appreciation (depreciation) on | ||||||||||||||||||||
| securities available for sale, net of tax | $ | 291,101 | $ | 160,399 | $ | 288,107 | $ | 407,966 | $ | 250,548 | ||||||||||
| Derivatives (notional value) | 5,787,952 | 5,222,994 | 5,614,502 | 3,752,445 | 3,361,296 | |||||||||||||||
| Fair value of derivatives portfolio | 40,848 | 46,936 | 43,973 | (2,407 | ) | 8,667 | ||||||||||||||
| Common stock prices (daily close): High | 39.23 | 39.11 | 36.96 | 38.48 | 37.01 | |||||||||||||||
| Low | 36.60 | 34.47 | 32.10 | 33.57 | 34.25 | |||||||||||||||
| End of period | 38.60 | 38.11 | 36.11 | 36.45 | 36.70 | |||||||||||||||
| Weighted average shares - Basic | 478,121,878 | 462,902,144 | 454,031,392 | 454,346,907 | 451,712,342 | |||||||||||||||
| Diluted | 484,009,961 | 468,604,312 | 459,369,269 | 460,387,879 | 457,879,467 | |||||||||||||||
| End of period shares outstanding | 475,535,863 | 481,195,674 | 455,682,560 | 452,984,331 | 456,031,476 | |||||||||||||||
| End of period banking offices | 1,122 | 1,132 | 1,081 | 1,085 | 1,095 | |||||||||||||||
| ATMs | 1,723 | 1,718 | 1,613 | 1,614 | 1,430 | |||||||||||||||
| NOTES: | All items referring to loans & leases include loans held for sale & are net of unearned income. | |||||||
| (1 | ) | BB&T had approximately 24,000 full-time equivalent employees at June 30, 2002. |
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 8 | Investor Relations | FAX (336) 733-3132 | |||
| As of / For the Quarter Ended | |||||||||||||||||
| (Dollars in thousands, except per share data) | 6/30/02 | 3/31/02 | 12/31/01 | 9/30/01 | 6/30/01 | ||||||||||||
| INCOME STATEMENTS EXCLUDING | |||||||||||||||||
| MERGER-RELATED CHARGES (1) | |||||||||||||||||
| Interest income - taxable equivalent | |||||||||||||||||
| Interest & fees on loans & leases | $ | 881,084 | $ | 844,804 | $ | 897,529 | $ | 977,910 | $ | 998,665 | |||||||
| Interest & dividends on securities | 276,837 | 272,326 | 278,719 | 279,120 | 278,356 | ||||||||||||
| Interest on short-term investments | 1,554 | 2,493 | 2,228 | 3,514 | 4,988 | ||||||||||||
| Total interest income - taxable equivalent | 1,159,475 | 1,119,623 | 1,178,476 | 1,260,544 | 1,282,009 | ||||||||||||
| Interest expense | |||||||||||||||||
| Interest on deposits | 258,187 | 259,602 | 315,532 | 381,409 | 421,861 | ||||||||||||
| Interest on short-term borrowed funds | 26,540 | 26,449 | 35,451 | 55,913 | 58,251 | ||||||||||||
| Interest on long-term debt | 147,442 | 148,310 | 152,488 | 154,498 | 153,438 | ||||||||||||
| Total interest expense | 432,169 | 434,361 | 503,471 | 591,820 | 633,550 | ||||||||||||
| Net interest income - taxable equivalent | 727,306 | 685,262 | 675,005 | 668,724 | 648,459 | ||||||||||||
| Less: Taxable equivalent adjustment | 37,210 | 37,990 | 42,938 | 45,572 | 53,404 | ||||||||||||
| Net interest income | 690,096 | 647,272 | 632,067 | 623,152 | 595,055 | ||||||||||||
| Provision for loan & lease losses | 58,500 | 56,500 | 65,000 | 45,500 | 44,298 | ||||||||||||
| Net interest income after provision for | |||||||||||||||||
| loan & lease losses | 631,596 | 590,772 | 567,067 | 577,652 | 550,757 | ||||||||||||
| Noninterest income | |||||||||||||||||
| Service charges on deposits | 101,476 | 90,162 | 93,773 | 88,305 | 87,992 | ||||||||||||
| Mortgage banking income | 43,963 | 50,562 | 39,194 | 52,068 | 51,482 | ||||||||||||
| Investment banking & brokerage fees & commissions | 56,039 | 52,893 | 45,085 | 43,599 | 42,904 | ||||||||||||
| Trust revenue | 24,197 | 23,128 | 18,962 | 22,931 | 23,929 | ||||||||||||
| Agency insurance commissions | 74,063 | 63,883 | 45,724 | 44,120 | 45,049 | ||||||||||||
| Other insurance commissions | 3,986 | 3,485 | 4,122 | 3,089 | 3,549 | ||||||||||||
| Other nondeposit fees & commissions | 52,480 | 44,116 | 46,709 | 48,600 | 47,750 | ||||||||||||
| Securities gains (losses), net | 19,666 | 13,407 | 32,257 | 3,786 | 3,576 | ||||||||||||
| Other income | 28,197 | 33,084 | 31,183 | 30,095 | 27,368 | ||||||||||||
| Total noninterest income | 404,067 | 374,720 | 357,009 | 336,593 | 333,599 | ||||||||||||
| Noninterest expense | |||||||||||||||||
| Personnel expense | 319,622 | 304,893 | 288,235 | 281,830 | 282,484 | ||||||||||||
| Occupancy & equipment expense | 84,688 | 83,451 | 73,890 | 79,222 | 75,102 | ||||||||||||
| Foreclosed property expense | 880 | 341 | 1,158 | 673 | 500 | ||||||||||||
| Amortization of intangibles | 6,258 | 4,351 | 17,854 | 18,529 | 18,404 | ||||||||||||
| Other noninterest expense | 163,850 | 140,655 | 140,144 | 134,456 | 133,161 | ||||||||||||
| Total noninterest expense | 575,298 | 533,691 | 521,281 | 514,710 | 509,651 | ||||||||||||
| Income before income taxes | 460,365 | 431,801 | 402,795 | 399,535 | 374,705 | ||||||||||||
| Provision for income taxes | 131,363 | 122,554 | 115,049 | 116,020 | 107,278 | ||||||||||||
| Income excluding merger-related charges (1) | $ | 329,002 | $ | 309,247 | $ | 287,746 | $ | 283,515 | $ | 267,427 | |||||||
| PER SHARE DATA EXCLUDING | |||||||||||||||||
| MERGER-RELATED CHARGES (1) | |||||||||||||||||
| Basic earnings | $ | .69 | $ | .67 | $ | .63 | $ | .62 | $ | .59 | |||||||
| Diluted earnings | .68 | .66 | .63 | .62 | .58 | ||||||||||||
| Dividends paid on common shares | .26 | .26 | .26 | .26 | .23 | ||||||||||||
| Book value per share | $ | 14.99 | $ | 14.66 | $ | 13.50 | $ | 13.18 | $ | 12.84 | |||||||
| RATIOS EXCLUDING | |||||||||||||||||
| MERGER-RELATED CHARGES (1) | |||||||||||||||||
| Return on average assets | 1.75 | % | 1.75 | % | 1.62 | % | 1.62 | % | 1.58 | % | |||||||
| Return on average equity | 18.44 | 19.39 | 18.56 | 19.05 | 18.95 | ||||||||||||
| Return on average realized equity (2) | 19.08 | 20.32 | 19.89 | 20.00 | 19.74 | ||||||||||||
| Net yield on earning assets (taxable equivalent) | 4.27 | 4.26 | 4.20 | 4.19 | 4.16 | ||||||||||||
| Efficiency (taxable equivalent) (3) | 50.9 | 50.5 | 50.3 | 51.3 | 52.0 | ||||||||||||
| Noninterest income as a percentage of | |||||||||||||||||
| total income (taxable equivalent) (3) | 35.5 | 35.1 | 34.5 | 33.2 | 33.7 | ||||||||||||
| Equity as a percentage of total assets | |||||||||||||||||
| end of period | 9.3 | 9.4 | 8.7 | 8.5 | 8.5 | ||||||||||||
| Average earning assets as a percentage of | |||||||||||||||||
| average total assets | 90.3 | 90.6 | 90.7 | 91.4 | 91.7 | ||||||||||||
| Average loans & leases as a percentage of | |||||||||||||||||
| average deposits | 101.9 | 104.7 | 105.7 | 106.0 | 104.3 | ||||||||||||
| CASH BASIS PERFORMANCE EXCLUDING | |||||||||||||||||
| MERGER-RELATED CHARGES (1)(4) | |||||||||||||||||
| Earnings excluding merger-related charges | $ | 332,899 | $ | 311,951 | $ | 304,526 | $ | 300,643 | $ | 285,243 | |||||||
| Diluted earnings per share | .69 | .67 | .66 | .65 | .62 | ||||||||||||
| Return on average tangible assets | 1.81 | % | 1.80 | % | 1.73 | % | 1.73 | % | 1.72 | % | |||||||
| Return on average tangible equity | 23.94 | 23.46 | 22.87 | 23.57 | 24.00 | ||||||||||||
| Return on average realized tangible equity (2) | 25.01 | 24.82 | 24.81 | 24.94 | 24.91 | ||||||||||||
| Efficiency ratio (taxable equivalent) (3) | 50.4 | 50.1 | 48.6 | 49.6 | 50.2 | ||||||||||||
| NOTES: | Applicable ratios are annualized. | |
| (1) | Net merger-related charges totaled $1.1 million, $(.4 million), $9.8 million, $61.5 million and $30.2 million, net of tax, for the quarters ended June 30, 2002, March 31, 2002, December 31, 2001, September 30, 2001, and June 30, | |
| (2) | Excludes the effect on average shareholders' equity of unrealized gains (losses) on securities available for sale. | |
| (3) | Excludes securities gains (losses), foreclosed property expense, provisions for the impairment of mortgage servicing rights and merger-related charges. | |
| (4) | Cash basis performance excludes the effect on earnings of amortization expense applicable to intangible assets and the unamortized balances of intangibles from assets and equity. |
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 9 | Investor Relations | FAX (336) 733-3132 | |||
| As of / For the Quarter Ended | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SELECTED BALANCE SHEET DATA | 6/30/02 | 3/31/02 | 12/31/01 | 9/30/01 | 6/30/01 | ||||||||||||
| (Dollars in thousands) | |||||||||||||||||
| End of period balances | |||||||||||||||||
| Securities available for sale | $ | 18,076,387 | $ | 17,515,228 | $ | 16,621,684 | $ | 16,679,755 | $ | 15,370,474 | |||||||
| Securities held to maturity | 47,366 | 44,189 | 40,496 | 38,379 | 308,846 | ||||||||||||
| Trading securities | 132,305 | 143,976 | 97,675 | 116,523 | 120,381 | ||||||||||||
| Total securities | 18,256,058 | 17,703,393 | 16,759,855 | 16,834,657 | 15,799,701 | ||||||||||||
| Commercial loans & leases | 28,375,721 | 28,139,248 | 25,959,142 | 25,532,901 | 25,102,074 | ||||||||||||
| Consumer loans | 12,355,759 | 11,962,560 | 11,214,193 | 11,278,277 | 11,228,486 | ||||||||||||
| Revolving credit loans | 986,145 | 953,956 | 951,319 | 908,868 | 892,969 | ||||||||||||
| Mortgage loans | 8,812,309 | 9,100,813 | 9,318,519 | 9,429,390 | 9,803,743 | ||||||||||||
| Total loans & leases | 50,529,934 | 50,156,577 | 47,443,173 | 47,149,436 | 47,027,272 | ||||||||||||
| Allowance for loan & lease losses | 706,446 | 705,905 | 644,418 | 634,552 | 610,171 | ||||||||||||
| Other earning assets | 330,555 | 333,035 | 360,789 | 370,912 | 506,263 | ||||||||||||
| Total earning assets | 68,638,124 | 67,924,614 | 64,087,088 | 63,685,851 | 62,923,591 | ||||||||||||
| Total assets | 76,333,441 | 74,949,720 | 70,869,945 | 70,309,046 | 68,811,370 | ||||||||||||
| Noninterest-bearing deposits | 7,625,530 | 7,142,729 | 6,939,640 | 6,356,051 | 6,419,145 | ||||||||||||
| Savings & interest checking | 3,290,255 | 3,287,663 | 3,013,702 | 3,094,104 | 3,263,459 | ||||||||||||
| Money rate savings | 14,632,630 | 14,894,883 | 13,902,088 | 13,156,255 | 12,768,711 | ||||||||||||
| CDs and other time deposits | 25,360,774 | 23,145,964 | 20,877,845 | 22,607,819 | 22,499,458 | ||||||||||||
| Total deposits | 50,909,189 | 48,471,239 | 44,733,275 | 45,214,229 | 44,950,773 | ||||||||||||
| Short-term borrowed funds | 4,930,434 | 6,043,367 | 6,649,100 | 5,923,442 | 5,704,614 | ||||||||||||
| Long-term debt | 10,979,492 | 11,444,091 | 11,721,076 | 11,408,329 | 10,864,249 | ||||||||||||
| Total interest-bearing liabilities | 59,193,585 | 58,815,968 | 56,163,811 | 56,189,949 | 55,100,491 | ||||||||||||
| Total shareholders' equity | 7,128,356 | 7,055,418 | 6,150,209 | 5,969,828 | 5,855,699 | ||||||||||||
| Goodwill | 1,457,257 | 1,417,993 | 879,903 | 792,689 | 804,916 | ||||||||||||
| Core deposit & other intangibles | 119,533 | 137,202 | 54,456 | 42,950 | 41,721 | ||||||||||||
| Total intangibles | 1,576,790 | 1,555,195 | 934,359 | 835,639 | 846,637 | ||||||||||||
| Mortgage servicing rights | 395,654 | 386,386 | 359,037 | 340,746 | 295,527 | ||||||||||||
| Negative goodwill | $ | -- | $ | -- | $ | 9,780 | $ | 10,465 | $ | 11,143 | |||||||
| Average balances | |||||||||||||||||
| Securities, at amortized cost | $ | 17,593,605 | $ | 16,481,523 | $ | 16,239,595 | $ | 16,015,660 | $ | 15,542,138 | |||||||
| Commercial loans & leases | 28,166,521 | 26,352,170 | 25,801,611 | 25,497,844 | 25,083,430 | ||||||||||||
| Consumer loans | 12,164,490 | 11,387,897 | 11,249,000 | 11,278,665 | 11,112,264 | ||||||||||||
| Revolving credit loans | 969,544 | 944,465 | 919,501 | 897,121 | 871,586 | ||||||||||||
| Mortgage loans | 8,964,574 | 9,148,681 | 9,452,120 | 9,510,234 | 9,348,150 | ||||||||||||
| Total loans & leases | 50,265,129 | 47,833,213 | 47,422,232 | 47,183,864 | 46,415,430 | ||||||||||||
| Other earning assets | 354,745 | 455,620 | 354,614 | 437,959 | 453,386 | ||||||||||||
| Total earning assets | 68,213,479 | 64,770,356 | 64,016,441 | 63,637,483 | 62,410,954 | ||||||||||||
| Total assets | 75,537,986 | 71,481,681 | 70,610,330 | 69,590,582 | 68,087,219 | ||||||||||||
| Noninterest-bearing deposits | 7,151,674 | 6,498,552 | 6,560,631 | 6,319,783 | 6,119,524 | ||||||||||||
| Savings & interest checking | 3,568,247 | 3,201,268 | 3,240,975 | 3,313,821 | 3,398,441 | ||||||||||||
| Money rate savings | 14,617,809 | 13,721,226 | 13,208,472 | 12,654,015 | 12,371,408 | ||||||||||||
| CDs and other time deposits | 24,007,049 | 22,276,868 | 21,864,320 | 22,237,050 | 22,628,040 | ||||||||||||
| Total deposits | 49,344,779 | 45,697,914 | 44,874,398 | 44,524,669 | 44,517,413 | ||||||||||||
| Short-term borrowed funds | 5,791,792 | 5,930,689 | 6,427,523 | 6,451,865 | 5,572,755 | ||||||||||||
| Long-term debt | 11,283,857 | 11,572,254 | 11,492,851 | 11,174,903 | 10,975,583 | ||||||||||||
| Total interest-bearing liabilities | 59,268,754 | 56,702,305 | 56,234,141 | 55,831,654 | 54,946,227 | ||||||||||||
| Total shareholders' equity | $ | 7,156,600 | $ | 6,469,084 | $ | 6,150,335 | $ | 5,903,303 | $ | 5,659,565 | |||||||
| RISK-BASED CAPITAL (1) | |||||||||||||||||
| Risk-based capital: | |||||||||||||||||
| Tier 1 | $ | 5,347,653 | $ | 5,371,989 | $ | 5,002,896 | $ | 4,829,647 | $ | 4,828,028 | |||||||
| Total | 7,019,561 | 7,205,160 | 6,796,958 | 6,613,329 | 5,950,114 | ||||||||||||
| Risk-weighted assets | 54,863,492 | 54,080,258 | 50,972,300 | 50,130,294 | 49,587,717 | ||||||||||||
| Average quarterly tangible assets | 73,649,018 | 69,534,802 | 69,262,888 | 68,411,234 | 67,464,682 | ||||||||||||
| Risk-based capital ratios: | |||||||||||||||||
| Tier 1 | 9.7 % | 9.9 % | 9.8 % | 9.6 % | 9.7 % | ||||||||||||
| Total | 12.8 | 13.3 | 13.3 | 13.2 | 12.0 | ||||||||||||
| Leverage capital ratio | 7.3 | 7.7 | 7.2 | 7.1 | 7.2 | ||||||||||||
| NOTES: | All items referring to loans & leases include loans held for sale & are net of unearned income. | |||||||
| (1 | ) | Current quarter information is estimated. | ||||||
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 10 | Investor Relations | FAX (336) 733-3132 | |||
| As of / For the Quarter Ended | |||||||||||||||||
| (Dollars in thousands) | 6/30/02 | 3/31/02 | 12/31/01 | 9/30/01 | 6/30/01 | ||||||||||||
| ASSET QUALITY ANALYSIS | |||||||||||||||||
| Allowance For Loan & Lease Losses | |||||||||||||||||
| Beginning balance | $ | 705,905 | $ | 644,418 | $ | 634,552 | $ | 610,171 | $ | 601,788 | |||||||
| Allowance for acquired loans, net | 136 | 61,177 | 9,047 | -- | 9,470 | ||||||||||||
| Provision for loan & lease losses | 58,500 | 56,500 | 65,000 | 68,500 | 48,798 | ||||||||||||
| Charge-offs | (69,144 | ) | (67,206 | ) | (76,082 | ) | (54,885 | ) | (59,750 | ) | |||||||
| Recoveries | 11,049 | 11,016 | 11,901 | 10,766 | 9,865 | ||||||||||||
| Net charge-offs | (58,095 | ) | (56,190 | ) | (64,181 | ) | (44,119 | ) | (49,885 | ) | |||||||
| Ending balance | $ | 706,446 | $ | 705,905 | $ | 644,418 | $ | 634,552 | $ | 610,171 | |||||||
| Nonperforming Assets | |||||||||||||||||
| Nonaccrual loans & leases | $ | 335,287 | $ | 354,916 | $ | 316,607 | $ | 266,384 | $ | 244,711 | |||||||
| Foreclosed real estate | 49,009 | 46,687 | 39,106 | 34,601 | 27,725 | ||||||||||||
| Other foreclosed property | 15,803 | 20,734 | 17,858 | 17,733 | 20,494 | ||||||||||||
| Restructured loans | -- | -- | -- | 183 | 521 | ||||||||||||
| Nonperforming assets | $ | 400,099 | $ | 422,337 | $ | 373,571 | $ | 318,901 | $ | 293,451 | |||||||
| Loans 90 days or more past due | |||||||||||||||||
| & still accruing | $ | 98,143 | $ | 100,962 | $ | 101,778 | $ | 93,968 | $ | 84,399 | |||||||
| Loans 90 days or more past due & still accruing | |||||||||||||||||
| as a percentage of total loans and leases | .19 | % | .20 | % | .21 | % | .20 | % | .18 | % | |||||||
| Asset Quality Ratios | |||||||||||||||||
| Nonaccrual and restructured loans & leases | |||||||||||||||||
| as a percentage of total loans & leases | .66 | % | .71 | % | .67 | % | .57 | % | .52 | % | |||||||
| Nonperforming assets as a percentage of: | |||||||||||||||||
| Total assets | .52 | .56 | .53 | .45 | .43 | ||||||||||||
| Loans & leases plus | |||||||||||||||||
| foreclosed property | .79 | .84 | .79 | .68 | .62 | ||||||||||||
| Net charge-offs as a percentage of | |||||||||||||||||
| average loans & leases | .46 | .48 | .54 | .37 | .43 | ||||||||||||
| Net charge-offs excluding specialized | |||||||||||||||||
| lending as a percentage of average | |||||||||||||||||
| loans & leases (1) | .38 | .37 | .46 | .30 | .37 | ||||||||||||
| Allowance for loan & lease losses as | |||||||||||||||||
| a percentage of loans & leases | 1.40 | 1.41 | 1.36 | 1.35 | 1.30 | ||||||||||||
| Ratio of allowance for loan & lease losses to: | |||||||||||||||||
| Net charge-offs | 3.03 | x | 3.10 | x | 2.53 | x | 3.63 | x | 3.05 | x | |||||||
| Nonaccrual and restructured loans & leases | 2.11 | 1.99 | 2.04 | 2.38 | 2.49 | ||||||||||||
| As of / for the Six Months Ended | Increase (Decrease) | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 6/30/02 | 6/30/01 | $ | % | ||||||||||||||
| Allowance For Loan & Lease Losses | |||||||||||||||||
| Beginning balance | $ | 644,418 | $ | 578,107 | $ | 66,311 | 11.5 | ||||||||||
| Allowance for acquired loans | 61,313 | 20,036 | 41,277 | NM | |||||||||||||
| Provision for loan & lease losses | 115,000 | 90,818 | 24,182 | 26.6 | |||||||||||||
| Charge-offs | (136,350 | ) | (100,262 | ) | (36,088 | ) | (36.0 | ) | |||||||||
| Recoveries | 22,065 | 21,472 | 593 | 2.8 | |||||||||||||
| Net charge-offs | (114,285 | ) | (78,790 | ) | (35,495 | ) | (45.1 | ) | |||||||||
| Ending balance | $ | 706,446 | $ | 610,171 | $ | 96,275 | 15.8 | ||||||||||
| Asset Quality Ratios | |||||||||||||||||
| Net charge-offs as a percentage of | |||||||||||||||||
| average loans & leases | .47 | % | .35 | % | |||||||||||||
| Ratio of allowance for loan & lease losses to | |||||||||||||||||
| net charge-offs | 3.07 | x | 3.84 | x | |||||||||||||
| For the Quarter Ended | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 6/30/02 | 3/31/02 | 12/31/01 | 9/30/01 | 6/30/01 | |||||||||||||
| ANNUALIZED INTEREST YIELDS / RATES (2) | |||||||||||||||||
| Interest income: | |||||||||||||||||
| Securities & other | 6.20 | % | 6.49 | % | 6.77 | % | 6.87 | % | 7.09 | % | |||||||
| Loans & leases | 7.03 | 7.14 | 7.52 | 8.24 | 8.63 | ||||||||||||
| Total earning assets | 6.81 | 6.97 | 7.33 | 7.88 | 8.23 | ||||||||||||
| Interest expense: | |||||||||||||||||
| Interest-bearing deposits | 2.45 | 2.69 | 3.27 | 3.96 | 4.41 | ||||||||||||
| Short-term borrowed funds | 1.84 | 1.81 | 2.19 | 3.44 | 4.19 | ||||||||||||
| Long-term debt | 5.24 | 5.19 | 5.27 | 5.49 | 5.60 | ||||||||||||
| Total interest-bearing liabilities | 2.92 | 3.10 | 3.55 | 4.21 | 4.62 | ||||||||||||
| Net yield on earning assets | 4.27 | % | 4.26 | % | 4.20 | % | 4.19 | % | 4.16 | % | |||||||
| NOTES: | All items referring to loans & leases include loans held for sale & are net of unearned income. Applicable ratios are annualized. | |||||||
| (1 | ) | Excludes net charge-offs and average loans from BB&T's consumer finance subsidiaries. | ||||||
| (2 | ) | Excludes merger-related charges. Fully taxable equivalent yields. Securities yields calculated based on amortized cost. | ||||||
| QUARTERLY PERFORMANCE SUMMARY | Tom A. Nicholson | ||||
| BB&T Corporation (NYSE:BBT) | Senior Vice President | (336) 733-3058 | |||
| Page 11 | Investor Relations | FAX (336) 733-3132 | |||
| For the Six Months Ended | Increase (Decrease) | ||||||||||||||||
| (Dollars in thousands) | 6/30/02 | 6/30/01 | $ | % | |||||||||||||
| SELECTED BALANCES EXCLUDING PURCHASE ACQUISITIONS (1) | |||||||||||||||||
| Average Balances | |||||||||||||||||
| Commercial loans & leases | $ | 28,068,609 | $ | 26,765,038 | $ | 1,303,571 | 4.9 | ||||||||||
| Consumer loans | 12,025,387 | 11,760,040 | 265,347 | 2.3 | |||||||||||||
| Revolving credit loans | 966,632 | 890,890 | 75,742 | 8.5 | |||||||||||||
| Mortgage loans (2) | 9,871,651 | 10,480,959 | (609,308 | ) | (5.8 | ) | |||||||||||
| Total loans & leases | 50,932,279 | 49,896,927 | 1,035,352 | 2.1 | |||||||||||||
| Noninterest-bearing deposits (3) | 7,267,939 | 6,643,656 | 624,283 | 9.4 | |||||||||||||
| Interest-bearing transaction accounts | 18,087,323 | 16,838,592 | 1,248,731 | 7.4 | |||||||||||||
| CDs and other time deposits | 23,810,659 | 24,523,855 | (713,196 | ) | (2.9 | ) | |||||||||||
| Total deposits | $ | 49,165,921 | $ | 48,006,103 | $ | 1,159,818 | 2.4 | ||||||||||
| For the Six Months Ended | Increase (Decrease) | ||||||||||||||||
| (Dollars in thousands) | 6/30/02 | 6/30/01 | $ | % | |||||||||||||
| SELECTED INCOME STATEMENT ITEMS EXCLUDING | |||||||||||||||||
| MERGER-RELATED CHARGES AND PURCHASE ACQUISITIONS (1) | |||||||||||||||||
| Net interest income - taxable equivalent | $ | 1,348,495 | $ | 1,282,864 | $ | 65,631 | 5.1 | % | |||||||||
| Noninterest income | |||||||||||||||||
| Service charges on deposits | 182,738 | 167,444 | 15,294 | 9.1 | |||||||||||||
| Mortgage banking income (4) | 92,019 | 92,674 | (655 | ) | (0.7 | ) | |||||||||||
| Investment banking & brokerage fees & commissions | 108,464 | 86,612 | 21,852 | 25.2 | |||||||||||||
| Trust revenue | 43,832 | 49,005 | (5,173 | ) | (10.6 | ) | |||||||||||
| Agency insurance commissions | 97,078 | 87,002 | 10,076 | 11.6 | |||||||||||||
| Other insurance commissions | 7,117 | 6,389 | 728 | 11.4 | |||||||||||||
| Other nondeposit fees & commissions | 91,315 | 92,299 | (984 | ) | (1.1 | ) | |||||||||||
| Securities gains (losses), net (4) | 32,716 | 7,208 | 25,508 | NM | |||||||||||||
| Other income | 59,967 | 50,847 | 9,120 | 17.9 | |||||||||||||
| Total noninterest income | 715,246 | 639,480 | 75,766 | 11.8 | |||||||||||||
| Noninterest expense | |||||||||||||||||
| Personnel expense | 571,226 | 556,793 | 14,433 | 2.6 | |||||||||||||
| Occupancy & equipment expense | 159,558 | 150,274 | 9,284 | 6.2 | |||||||||||||
| Other noninterest expense | 290,653 | 287,226 | 3,427 | 1.2 | |||||||||||||
| Total noninterest expense | $ | 1,021,437 | $ | 994,293 | $ | 27,144 | 2.7 | % | |||||||||
| NOTES: | (1 | ) | Amounts adjusted to exclude growth that resulted from the timing of acquisitions purchased during 2002 and 2001. | |||||
| (2 | ) | Excludes the impact of mortgage loan securitization programs in 2001. | ||||||
| (3 | ) | Excludes the impact of the outsourcing of official checks in both 2002 and 2001. | ||||||
| (4 | ) | Mortgage banking income includes a $25.5 million provision for the impairment of mortgage servicing rights in 2002. This provision is offset by securities gains. | ||||||
| NM | - not meaningful. | |||||||
S I G N A T U R E
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
BB&T CORPORATION
(Registrant)
By: /S/ SHERRY A. KELLETT
��Sherry A. Kellett
Senior Executive Vice President and Controller
(Principal Accounting Officer)
Date: July 11, 2002
