BB&T 2009 Annual Report Download - page 67

During 2007, BB&T recorded merger-related and restructuring charges of $21 million. These expenses were
recorded in connection with the acquisition of Coastal and other merger-related and restructuring activities.
The following table presents the components of merger-related and restructuring charges included in
noninterest expenses. This table includes changes to previously recorded merger-related accruals and period
expenses for merger-related items that must be expensed as incurred. Items that are required to be expensed as
incurred include certain expenses associated with systems conversions, data processing, training and other costs.
Table 21
Summary of Merger-Related and Restructuring Charges
For the Year Ended
December 31,
2009 2008 2007
(Dollars in millions)
Severance and personnel-related $17 $5 $8
Occupancy and equipment 132
Other 20 711
Total $38 $15 $21
Severance and personnel-related costs or credits include severance, employee retention, payments related to
change-in-control provisions of employment contracts, outplacement services and other benefits associated with
employee termination or reversals of previously estimated amounts, which typically occur in corporate support
and data processing functions. Occupancy and equipment charges or credits represent merger-related and
restructuring costs or gains associated with lease terminations, obsolete equipment write-offs, and the sale of
duplicate facilities and equipment. Credits may result when obsolete properties or equipment are sold for more
than originally estimated. Other merger-related and restructuring charges or credits include expenses necessary
to convert and combine the acquired branches and operations of merged companies, direct media advertising
related to the acquisitions, asset and supply inventory write-offs, litigation accruals, and other similar charges.
Merger-related and restructuring accruals are established when the costs are incurred or once all
requirements for a plan to dispose of certain business functions have been approved by management. In general,
a major portion of accrued costs are utilized in conjunction with or immediately following the systems conversion,
when most of the duplicate positions are eliminated and the terminated employees begin to receive severance.
Other accruals are utilized over time based on the sale, closing or disposal of duplicate facilities or equipment or
the expiration of lease contracts. Merger and restructuring accruals are re-evaluated periodically and adjusted as
necessary. The remaining accruals at December 31, 2009 are expected to be utilized during 2010, unless they
relate to specific contracts that expire in later years. The following tables present a summary of activity with
respect to BB&T’s merger and restructuring accruals. These tables include costs reflected as expenses, as
presented in the table above, and certain accruals recorded through purchase accounting adjustments.
Merger-related and Restructuring Accrual Activity
(Dollars in millions)
Balance
January 1,
2008 Accrued at acquisition
Merger-
related and
restructuring
charges Utilized Other, net
Balance
December 31,
2008
Severance and personnel-related $ 9 $ 3 $ 5 $(10) $— $ 7
Occupancy and equipment 4 1 3 (2) — 6
Other 3 8 7 (8) 1 11
Total $16 $ 12 $15 $(20) $ 1 $24
Balance
January 1,
2009 Accrued at acquisition
Merger-
related and
restructuring
charges Utilized Other, net
Balance
December 31,
2009
Severance and personnel-related $ 7 $— $17 $(18) $— $ 6
Occupancy and equipment 6 — 1 (2) (2) 3
Other 11 — 20 (28) 3 6
Total $24 $— $38 $(48) $ 1 $15
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