BB&T 2009 Annual Report Download - page 16

Stock was approximately $3.1 billion, including approximately $14 million of accrued and unpaid dividends. On
July 22, 2009, BB&T repurchased the warrant to purchase up to 13,902,573 shares of its common stock for $67
million, which also was issued to the U.S. Treasury on November 14, 2008, as part of the Capital Purchase
Program.
On August 14, 2009, BB&T acquired certain assets and assumed substantially all of the deposits and certain
other liabilities of Colonial Bank (“Colonial”), headquartered in Montgomery, Alabama, from the Federal Deposit
Insurance Corporation (“FDIC”), as receiver for Colonial. Colonial operated 357 banking offices in Alabama,
Florida, Georgia, Texas and Nevada. The acquisition significantly strengthened BB&T’s banking franchise,
moving BB&T to fifth in deposit market share in Florida and fourth in Alabama. BB&T issued 38.5 million shares
of common stock to the investing public at $26 per share in connection with the Colonial acquisition to further
strengthen BB&T’s capital levels. Early in 2010, BB&T exited the Nevada branches and divested approximately
$850 million in deposits acquired in the Colonial acquisition. Please refer to Note 2 “Business Combinations” in
the “Notes to Consolidated Financial Statements” for additional disclosures about the Colonial acquisition.
In addition to the Colonial acquisition, BB&T continued to expand its noninterest revenue producing
business through the acquisitions of Dallas, Texas-based Quantum First Capital, LTD and Louisville, Kentucky-
based BFG Realty Advisors, LLC. Both firms were acquired by BB&T’s wholly-owned subsidiary Grandbridge
Real Estate Capital LLC. BB&T also acquired Florida-based insurance agency Oswald Trippe and Company Inc.
Consolidated net income for 2009 totaled $877 million, a decrease of $652 million, or 42.6%, compared to $1.5
billion earned during 2008. Consolidated net income available to common shareholders for 2009 totaled $729
million, a decrease of $769 million, or 51.3%, compared to $1.5 billion earned during 2008. On a diluted per common
share basis, earnings for 2009 were $1.15, compared to $2.71 for 2008, a decrease of 57.6%. BB&T’s results of
operations for 2009 produced a return on average assets of .56% and a return on average common shareholders’
equity of 4.93% compared to prior year ratios of 1.12% and 11.44%, respectively.
BB&T generated strong revenue growth during 2009, which was up 18.3% compared to 2008. This included
growth of 14.9% in fully taxable equivalent net interest income and 23.1% growth from noninterest income
sources. The growth in net interest income was the result of growth in earning assets, as well as expansion in the
net interest margin from 3.58% in 2008 to 3.66% in 2009. Noninterest income benefitted from record performance
from BB&T’s residential mortgage banking and insurance operations. BB&T generated $658 million in revenues
from mortgage banking operations, which was up 139.3% from the 2008 results. Insurance income increased 12.8%
in 2009 and exceeded $1 billion annually.
Nonperforming assets and credit costs continued to increase during 2009. BB&T recorded a $2.8 billion
provision for credit losses in 2009, which exceeded net charge-offs by $1.0 billion. This compared to a $1.4 billion
provision for credit losses recorded during 2008. Net charge-offs for 2009 totaled $1.8 billion compared to $851
million for 2008. The increases in nonperforming assets and the provision for credit losses were primarily driven
by continued deterioration in housing-related credits. The largest concentration of housing-related credit issues
continues to be in Georgia, Florida and metropolitan Washington, D.C., including the surrounding suburbs. In
addition, there has been deterioration in the coastal areas of the Carolinas.
BB&T’s total assets at December 31, 2009 were $165.8 billion, an increase of $13.7 billion, or 9.0%, compared
to December 31, 2008. Total loans and leases at December 31, 2009 were $106.2 billion, an increase of $7.5 billion,
or 7.6%, compared to the balance at year-end 2008. The increase in total loans and leases included increases of $1.1
billion in loans held for sale and $8.0 billion in covered loans acquired in the Colonial transaction. Securities
available for sale increased $1.1 billion compared to the balances at December 31, 2008. In addition, BB&T
recorded a $3.1 billion receivable from the FDIC in connection with the Colonial acquisition. The FDIC receivable
represents the fair value of amounts expected to be received under the agreement with the FDIC, whereby the
FDIC will reimburse BB&T for the significant majority of losses on the assets acquired.
Total client deposits at December 31, 2009 were $106.8 billion, an increase of $23.2 billion, or 27.7%, from
December 31, 2008. Total deposits, which include wholesale deposits sources, totaled $115.0 billion at
December 31, 2009, an increase of $16.4 billion, or 16.6%, compared to December 31, 2008. The increase in client
deposits was a result of the Colonial acquisition, which added approximately $16 billion in client deposits, as well
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