Exhibit 99.7
Appendix
Reconciliationsof Non-GAAP
Financial Measures
GeneratingFeeIncomeandOperating Efficiency1
For the Years Ended December 31, | ||||||||||||||
2004 | 2005 | 2006 | 2007 | 2008 | ||||||||||
Noninterest Income as a Percentage of Net Revenue | ||||||||||||||
(T/E) Based on Operating Earnings | 37.8 | % | 39.1 | % | 40.6 | % | 41.3 | % | 40.3 | % | ||||
Effect of other, net (1) | - | - | - | - | 1.1 | |||||||||
Noninterest Income as a Percentage of | ||||||||||||||
Net Revenue (T/E) Based on GAAP | 37.8 | % | 39.1 | % | 40.6 | % | 41.3 | % | 41.4 | % | ||||
Cash Basis Efficiency Ratio | 49.7 | % | 50.4 | % | 53.2 | % | 51.6 | % | 51.3 | % | ||||
Effect of pretax merger-related and restructuring items | .1 | (.2 | ) | .3 | .3 | .2 | ||||||||
Effect of pretax amortization of intangibles | 2.0 | 1.9 | 1.6 | 1.5 | 1.3 | |||||||||
Effect of other, net (2) | - | .8 | ( .4 | ) | .3 | (.7 | ) | |||||||
Effect of amortization of mark-to-market adjustments | .2 | .2 | .1 | - | - | |||||||||
Efficiency Ratio Based on GAAP | 52.0 | % | 53.1 | % | 54.8 | % | 53.7 | % | 52.1 | % | ||||
Operating Leverage | (1.36 | )% | (1.51 | )% | (4.79 | )% | 3.03 | % | 1.05 | % | ||||
Effect of merger-related and restructuring items | ||||||||||||||
and non-recurring items (3) | 19.77 | (.91 | ) | .24 | (.03 | ) | 2.95 | |||||||
Operating Leverage Based on GAAP | 18.41 | % | (2.42 | )% | (4.55 | )% | 3.00 | % | 4.00 | % |
(1) | Reflects gains from the initial public offering and sale of Visa stock in 2008, and the impact of a nonrecurring item associated with BB&T’s leasing operations in 2003. |
(2) | Reflects gains from the initial public offering and sale of Visa stock, a gain from the early extinguishment of debt and nonrecurring professional fees in 2008, a reserve charge relating to the Visa settlement in 2007, a gain on the sale of duplicate facilities in 2006, and a one-time adjustment related to the accounting for property and equipment leases in 2005. |
(3) | Reflects the impact of the fluctuations in merger-related and restructuring charges and non-recurring items. |
1
Operating Efficiency | ||||||||
Annualized Link Quarter | ||||||||
4Q08 vs 3Q08 | 3Q08 vs 2Q08 | 2Q08 vs 1Q08 | 1Q08 vs 4Q07 | |||||
Revenue Growth | 7.38 | % | 3.40 | % | 22.48 | % | 10.49 | % |
Effect of other, net (1) | (8.64 | ) | (6.72 | ) | 2.48 | 7.92 | ||
Revenue Growth Based on GAAP | (1.26 | )% | (3.32 | )% | 24.96 | % | 18.41 | % |
Expense Growth | 3.98 | 1.20 | 22.13 | 8.70 | ||||
Effect of other, net (1) | (2.01 | ) | 18.24 | (10.96 | ) | (11.26 | ) | |
Expense Growth Based on GAAP | 1.97 | 19.44 | 11.17 | (2.56 | ) | |||
Operating Leverage | 3.40 | % | 2.20 | % | .35 | % | 1.79 | |
Effect of other, net (1) | (6.63 | ) | (24.96 | ) | 13.44 | 19.18 | ||
Operating Leverage Based on GAAP | 3.23 | % | (22.76 | ) | 13.79 | 20.97 |
(1)Reflects the impact of the fluctuations in merger-related and restructuring charges and non-recurring items.
2
Operating Earnings
AvailabletoCommon Shareholders
asoriginally reported(dollarsinmillions)
Operating Earnings | Net Income | |||||
1993 | $ | 98 | $ | 98 | ||
1994 | 237 | 237 | ||||
1995 | 254 | 178 | ||||
1996 | 305 | 284 | ||||
1997 | 409 | 360 | ||||
1998 | 513 | 502 | ||||
1999 | 659 | 613 | ||||
2000 | 875 | 626 | ||||
2001 | 1,100 | 974 | ||||
2002 | 1,318 | 1,303 | ||||
2003 | 1,424 | 1,065 | ||||
2004 | 1,562 | 1,558 | ||||
2005 | 1,674 | 1,654 | ||||
2006 | 1,707 | 1,528 | ||||
2007 | 1,749 | 1,734 | ||||
2008 | 1,376 | 1,498 | ||||
Fifteen-Year Compound Annual Growth Rate | 19.2 | % | 19.9 | % |
3
Pre-Tax Pre-Provision
Operating Earnings
as originally reported(dollars in millions)
Operating | GAAP | |||||
1993 | $ | 164 | $ | 164 | ||
1994 | 380 | 380 | ||||
1995 | 411 | 295 | ||||
1996 | 505 | 472 | ||||
1997 | 705 | 637 | ||||
1998 | 828 | 813 | ||||
1999 | 1,059 | 996 | ||||
2000 | 1,395 | 1,033 | ||||
2001 | 1,739 | 1,584 | ||||
2002 | 2,093 | 1,556 | ||||
2003 | 2,293 | 1,865 | ||||
2004 | 2,577 | 2,571 | ||||
2005 | 2,716 | 2,684 | ||||
2006 | 2,778 | 2,713 | ||||
2007 | 3,053 | 3,018 | ||||
2008 | 3,392 | 3,493 | ||||
Fifteen-Year Compound Annual Growth Rate | 22.4 | % | 22.6 | % |
4
Earnings Performance | |||||||||||||||||||
For the Year Ended December 31, | |||||||||||||||||||
Dollars in Millions | 2004 | 2005 | 2006 | 2007 | 2008 | ||||||||||||||
Total Revenues Based on Operating Results | 6,666 | 7,830 | 9,489 | 10,668 | 10,334 | ||||||||||||||
Pretax merger-related and restructuring charges | - | - | - | - | - | ||||||||||||||
Other, net (1) | - | 2 | (75 | ) | - | 70 | |||||||||||||
Total Revenues Based on GAAP Results | 6,666 | 7,832 | 9,414 | 10,668 | 10,404 | ||||||||||||||
Operating Earnings Available to Common Shareholders | 1,562 | 1,674 | 1,707 | 1,749 | 1,376 | ||||||||||||||
Merger-related and restructuring charges, net of tax | (4 | ) | 7 | (11 | ) | (13 | ) | (10 | ) | ||||||||||
Other, net (2) | - | (27 | ) | (168 | ) | (2 | ) | 132 | |||||||||||
Net Income Available to Common Shareholders | 1,558 | 1,654 | 1,528 | 1,734 | 1,498 | ||||||||||||||
Return on Assets Based on Operating Earnings | 1.62 | 1.60 | 1.49 | 1.38 | 1.02 | ||||||||||||||
Effect of after-tax merger-related and restructuring charges | - | .01 | (.01 | ) | (.01 | ) | (.01 | ) | |||||||||||
Effect of other, net (2) | - | (.03 | ) | (.14 | ) | - | .10 | ||||||||||||
Return on Assets Based on Net Income | 1.62 | 1.58 | 1.34 | 1.37 | 1.11 | ||||||||||||||
Return on Common Equity Based on Operating Earnings Available to Common Shareholders | 14.74 | 15.12 | 14.91 | 14.37 | 10.51 | ||||||||||||||
Effect of after-tax merger-related and restructuring charges | (.03 | ) | .07 | (.10 | ) | (.10 | ) | (.08 | ) | ||||||||||
Effect of other, net (2) | - | (.24 | ) | (1.46 | ) | (.02 | ) | 1.01 | |||||||||||
Return on Common Equity Based on Net Income Available to Common Shareholders | 14.71 | 14.95 | 13.35 | 14.25 | 11.44 | ||||||||||||||
Diluted EPS Based on Operating Earnings Available to Common Shareholders | 2.81 | 3.04 | 3.14 | 3.17 | 2.49 | ||||||||||||||
Effect of after-tax merger-related and restructuring charges | (.01 | ) | .01 | (.02 | ) | (.02 | ) | (.02 | ) | ||||||||||
Effect of other, net (2) | - | (.05 | ) | (.31 | ) | (.01 | ) | .24 | |||||||||||
Diluted EPS Based on Net Income Available to Common Shareholders | 2.80 | 3.00 | 2.81 | 3.14 | 2.71 | ||||||||||||||
Cash ROA | 1.79 | 1.77 | 1.63 | 1.50 | 1.11 | ||||||||||||||
Effect of amortization of mark-to-market adjustments, net of tax | (.01 | ) | (.02 | ) | (.01 | ) | - | - | |||||||||||
Effect of amortization of intangibles, net of tax (3) | (.16 | ) | (.15 | ) | (.13 | ) | (.12 | ) | (.09 | ) | |||||||||
Return on Assets Based on Operating Earnings | 1.62 | 1.60 | 1.49 | 1.38 | 1.02 | ||||||||||||||
Cash ROCE | 26.36 | 27.12 | 27.23 | 26.82 | 19.30 | ||||||||||||||
Effect of amortization of mark-to-market adjustments, net of tax | (.28 | ) | (.29 | ) | (.13 | ) | (.03 | ) | - | ||||||||||
Effect of amortization of intangibles, net of tax (3) | (11.34 | ) | (11.71 | ) | (12.19 | ) | (12.42 | ) | (8.79 | ) | |||||||||
Return on Common Equity Based on Operating Earnings Available to Common Shareholders | 14.74 | 15.12 | 14.91 | 14.37 | 10.51 | ||||||||||||||
Cash Basis Diluted EPS | 2.96 | 3.20 | 3.27 | 3.29 | 2.60 | ||||||||||||||
Effect of amortization of mark-to-market adjustments, net of tax | (.03 | ) | (.04 | ) | (.01 | ) | - | - | |||||||||||
Effect of amortization of intangibles, net of tax | (.12 | ) | (.12 | ) | (.12 | ) | (.12 | ) | (.11 | ) | |||||||||
Diluted EPS Based on Operating Earnings Available to Common Shareholders | 2.81 | 3.04 | 3.14 | 3.17 | 2.49 |
(1) | Includes gains from the initial public offering and sale of Visa stock, net securities gains and other-than-temporary impairment losses,and an adjustment related to the accounting for leveraged leases in 2008, a loss on sale of securities in 2006, and a one-time adjustment related to the accounting for property and equipment leases in 2005. |
(2) | Includes gains from the initial public offering and sale of Visa stock, a gain from the early extinguishment of debt, net securities gains, other-than-temporary impairment losses and nonrecurring professional fees in 2008, a reserve charge relating to the Visa settlement and a credit to the provision for income taxes in 2007, an additional tax provision related to leveraged leases, a loss on the sale of securities, and the impact of a gain on the sale of duplicate facilities in 2006, and a one-time adjustment related to the accounting for property and equipment leases in 2005. |
(3) | Excludes average intangibles from average assets and average equity, net of deferred taxes, in the calculation of cash basis ratios. |