BB&T 2009 Annual Report Download - page 153

BB&T CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
BB&T also held derivatives not designated as hedges with notional amounts totaling $30.0 billion at
December 31, 2009 as risk management instruments primarily to facilitate transactions on behalf of its clients, as
well as activities related to balance sheet management.
At December 31, 2009, BB&T had designated notional values of $73 million of derivatives as net investment
hedges used to hedge the variability in a foreign currency exchange rate.
Credit risk related to derivatives arises when amounts receivable from a counterparty exceed those payable.
BB&T controls the risk of loss by subjecting counterparties to credit reviews and approvals similar to those used
in making loans and other extensions of credit. In addition, certain counterparties are required to provide cash
collateral to BB&T when their unsecured loss positions exceed certain negotiated limits. These bilateral limits are
typically based on current credit ratings and vary with ratings changes. As of December 31, 2009 and 2008, BB&T
had received cash collateral of approximately $82 million and $165 million, respectively. In addition, BB&T had
posted collateral of $138 million and $180 million at December 31, 2009 and 2008, respectively. In the event that
BB&T’s credit ratings had been downgraded below investment grade, the amount of collateral posted would have
increased by $50 million and $225 million as of December 31, 2009 and 2008, respectively. As of December 31,
2009, BB&T had approximately $26 million of unsecured positions with derivative dealers. All of the derivative
contracts to which BB&T is a party settle monthly, quarterly or semiannually. In the case of contracts with
derivative dealers, BB&T only transacts with dealers that are national market makers whose credit ratings are
strong. Further, BB&T has netting agreements with the dealers with which it does business. Because of these
factors, BB&T’s credit risk exposure related to derivatives contracts at December 31, 2009 and 2008 was not
material.
NOTE 20. Computation of Earnings Per Common Share
The basic and diluted earnings per common share calculations are presented in the following table:
Years Ended December 31,
2009 2008 2007
(Dollars in millions, except per share
data, shares in thousands)
Basic Earnings Per Share:
Net income available to common shareholders $ 729 $ 1,498 $ 1,734
Weighted average number of common shares 629,583 548,847 547,184
Basic earnings per share $ 1.16 $ 2.73 $ 3.17
Diluted Earnings Per Share:
Net income available to common shareholders $ 729 $ 1,498 $ 1,734
Weighted average number of common shares 629,583 548,847 547,184
Add:
Effect of dilutive outstanding equity-based awards 6,036 3,651 4,571
Weighted average number of diluted common shares 635,619 552,498 551,755
Diluted earnings per share $ 1.15 $ 2.71 $ 3.14
For the years ended December 31, 2009, 2008 and 2007, respectively, the number of antidilutive options was
38.6 million, 33.5 million and 14.0 million. In addition, BB&T had a warrant outstanding for 13.9 million shares as
of December 31, 2008 that was antidilutive.
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