BB&T 2014 Annual Report Download - page 34

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Table of Contents

Executive Overview
Significant Accomplishments
Significant accomplishments during 2014 included:
·Record net income available to common shareholders of $2.0 billion, a 28.2% increase over the prior year.
·Continued improvement in credit quality:
oNPAs declined $392 million, or 33.4%.
oNet charge-offs as a percentage of average loans and leases were 0.46% for 2014, compared to 0.69% for 2013.
oALLL was 274% of net charge-offs at December 31, 2014, compared to 219% at December 31, 2013.
·Continued improvement in deposit mix and average cost:
oAverage noninterest-bearing deposits increased 10.0% during 2014 and represented 28.9% of total average deposits for 2014 compared to
26.4% in 2013.
oThe average cost of interest-bearing deposits for 2014 was 0.26%, a decline of six basis points compared to the prior year.
·Strong growth in regulatory capital ratios during 2014:
oTier 1 risk-based capital was 12.4% at year-end 2014, compared to 11.8% at year-end 2013.
oTotal capital was 14.9% at year-end 2014, compared to 14.3% at year-end 2013.
oLeverage capital was 9.9% at year-end 2014, compared to 9.3% at year-end 2013.
·Strategic mergers to complement organic growth:
oCompleted the purchase of 21 branches in Texas, providing $1.2 billion in deposits.
oReached an agreement to acquire 41 additional branches in Texas with approximately $2.3 billion in deposits.
oReached an agreement to acquire The Bank of Kentucky Financial Corporation, which has $1.9 billion in assets, $1.6 billion in deposits and 32
branches and a strong market share in the northern Kentucky/Cincinnati market.
oReached an agreement to acquire Susquehanna Bancshares, Inc., which has $18.7 billion in assets, $13.7 billion in deposits and 245 branches in
Pennsylvania, New Jersey, West Virginia and Maryland.
Key Challenges
BB&T’s business has become more dynamic and complex in recent years. Consequently, management has annually evaluated and, as necessary, adjusted the
Company’s business strategy in the context of the current operating environment. During this process, management considers the current financial condition
and performance of the Company and its expectations for future economic activity from both a national and local market perspective. The achievement of
BB&T’s key strategic objectives and established long-term financial goals is subject to many uncertainties and challenges. In the opinion of management,
the challenges that are most relevant and likely to have a near term impact on performance are presented below:
·Intense competition within the financial services industry given the challenge in growing assets during a period of sustained low interest rates.
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Source: BB&T CORP, 10-K, February 25, 2015 Powered by Morningstar® Document Research℠
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