BB&T 2008 Annual Report Download - page 103

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BB&T CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The gross additional interest income that would have been earned if the loans and leases classified as
nonaccrual had performed in accordance with the original terms was approximately $69 million, $30 million and
$20 million in 2008, 2007 and 2006, respectively.
NOTE 6. Premises and Equipment
A summary of premises and equipment is presented in the accompanying table: December 31,
2008 2007
(Dollars in millions)
Land and land improvements $ 420 $ 416
Buildings and building improvements 1,008 989
Furniture and equipment 1,012 951
Leasehold improvements 410 328
Construction in progress 69 71
Capitalized leases on premises and equipment 3 3
Total 2,922 2,758
Less—accumulated depreciation and amortization (1,342) (1,229)
Net premises and equipment $ 1,580 $ 1,529
Useful lives for premises and equipment are as follows: buildings and building improvements—40 years;
furniture and equipment—5 to 10 years; leasehold improvements—estimated useful life or lease term, including
certain renewals which were deemed probable at lease inception, whichever is less; and capitalized leases on
premises and equipment—estimated useful life or remaining term of tenant lease, whichever is less. Certain
properties are pledged to secure mortgage indebtedness totaling $2 million at December 31, 2008 and 2007.
BB&T has noncancelable leases covering certain premises and equipment. Many of the leases have one or more
renewal options, generally for periods of two to five years. Total rent expense applicable to operating leases was
$164 million, $159 million and $146 million for 2008, 2007 and 2006, respectively. Rental income from owned
properties and subleases was $7 million, $8 million and $9 million for 2008, 2007 and 2006, respectively. Future
minimum lease payments for operating leases for years subsequent to 2008 are $131 million, $117 million, $103
million, $84 million, and $69 million for the next five years. The payments for 2014 and later years total $430 million.
NOTE 7. Goodwill and Other Intangible Assets
The changes in the carrying amounts of goodwill attributable to each of BB&T’s operating segments for the
years ended December 31, 2008 and 2007 are as follows:
Goodwill Activity by Operating Segment
Banking
Network
Residential
Mortgage
Banking Sales
Finance Specialized
Lending Insurance
Services Financial
Services All
Other Total
(Dollars in millions)
Balance January 1, 2007 $3,785 $ 7 $ 93 $ 52 $ 690 $174 $26 $4,827
Acquired goodwill, net 246 — — 47 37 — — 330
Contingent consideration — — — 1 22 18 — 41
Divestiture — — — — (8) — — (8)
Other adjustments 4 — — — — — — 4
Balance December 31, 2007 4,035 7 93 100 741 192 26 5,194
Acquired goodwill, net — — — 1 246 — — 247
Contingent consideration — — — — 48 — — 48
Other adjustments 3 — — (3) (6) — — (6)
Balance, December 31, 2008 $4,038 $ 7 $ 93 $ 98 $1,029 $192 $26 $5,483
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