BB&T 2013 Annual Report Download - page 30

30
Common Stock, Dividends and Share Repurchases
BB&T’s ability to pay dividends is primarily dependent on earnings from operations, the adequacy of capital and the
availability of liquid assets for distribution and is subject to the FRB not objecting to our capital plan. BB&T’s ability to
generate liquid assets for distribution is dependent on the ability of Branch Bank to pay dividends to the Parent Company.
The payment of cash dividends is an integral part of providing a competitive return on shareholders’ investments. The
Company’s policy is to accomplish this while retaining sufficient capital to support future growth and to meet regulatory
requirements. Management has established a guideline that the common dividend payout ratio will be between 30% and 50%
and the total payout ratio (including dividends and share repurchases) will be between 30% and 80% of basic EPS during
normal economic conditions. BB&T’s common dividend payout ratio, computed by dividing dividends declared per common
share by basic EPS, was 41.4% in 2013 compared to 29.2% in 2012. BB&T has paid a cash dividend to shareholders every
year since 1903. In January 2013, the common dividend payment dates were realigned to occur in the same quarter the
dividends are declared. Going forward, BB&T expects common dividend declarations, if declared, to occur in January, April,
July and October with payment dates on or about the first of March, June, September and December. A discussion of
dividend restrictions is included in Note 15 “Regulatory Requirements and Other Restrictions” in the “Notes to Consolidated
Financial Statements” and in the “Regulatory Considerations” section.
Share Repurchases
BB&T has periodically repurchased shares of its own common stock. In accordance with North Carolina law, repurchased
shares cannot be held as treasury stock, but revert to the status of authorized and unissued shares upon repurchase.
During 2006, BB&T’s Board of Directors granted authority under the 2006 Repurchase Plan for the repurchase of up to 50
million shares of BB&T’s common stock. The 2006 Repurchase Plan remains in effect until all the authorized shares are
repurchased unless the plan is modified by the Board of Directors. No shares were repurchased in connection with the 2006
Repurchase Plan during 2013, 2012, or 2011.
Table 5
Share Repurchase Activity
Maximum Remaining
Number of Shares
Total Average Total Shares Repurchased Available for Repurchase
Shares Price Paid Pursuant to Pursuant to
Repurchased (1) Per Share (2) Publicly-Announced Plan Publicly-Announced Plan
(Shares in thousands)
October 2013 32 $ 33.77 ― 44,139
N
ovember 2013 7 33.83 ― 44,139
December 2013 1 36.35 ― 44,139
Total 40 33.82 ― 44,139
(1) Repurchases reflect shares exchanged or surrendered in connection with the exercise of equity-based awards under
BB&T’s equity-based compensation plans.
(2) Excludes commissions.
Preferred Stock
During 2013, BB&T issued $500 million of Non-Cumulative Perpetual Preferred Stock for net proceeds of $487 million.
These securities are expected to qualify as non-common Tier 1 capital under the new Basel III capital rules. If declared,
dividends are payable quarterly, in arrears, at a rate of 5.20% per annum. See Note 10 “Shareholders’ Equity” in the “Notes
to Consolidated Financial Statements” for additional information.
On April 23, 2013, BB&T’s shareholders approved a plan that modified the record date and payment date of preferred stock
dividends to align with the record and payment date practices associated with common stock dividends. This action was
undertaken in order to achieve administrative and Board-level efficiencies and reduce the costs associated with multiple
record dates and multiple payment dates.