BB&T Posts Merger-Driven Profit Growth
July 21 2016 - 6:50AM
Dow Jones News
BB&T Corp. said profit and revenue rose in its latest
quarter as recent acquisitions helped boost growth.
Its earnings results beat Wall Street expectations.
The Winston-Salem, N.C.-based lender reported earnings of $587
million, up from $501 million a year earlier. Per-share profit grew
to 66 cents from 62 cents as the number of shares outstanding grew
12%. Excluding certain items, earnings per share were 71 cents.
Total revenue, which is a combination of net interest income and
fee-based income, grew 18% to $2.75 billion.
Analysts polled by Thomson Reuters projected adjusted profit of
65 cents a share on $2.73 billion in revenue.
The regional bank has been making a string of deals recently. In
April, it closed its $1.8 billion purchase of Pennsylvania-based
National Penn Bancshares Inc. and its $500 million deal to acquire
U.S. wholesale insurance broker Swett & Crawford.
Chief Executive Kelly King said both acquisitions "contributed
to our strong second-quarter results" as the company continues to
expand its footprint. The company said merger-related and
restructuring charges took $58 million off the bottom line.
Net interest income rose to $1.62 billion from $1.31 billion a
year earlier. Net interest margin, a key profitability measure,
rose from a year earlier. That gauge, which is closely tied to
interest rates, came in at 3.41%, up from 3.27% in the same quarter
last year, but down from the 3.43% in the previous quarter.
Revenue from fees increased 11% to $1.13 billion, primarily due
to the acquisitions while noninterest expenses increased 8.7%
because of higher personnel costs and merger-related and
restructuring charges, also related to the recent deals.
BB&T added to its provision for loan losses, setting aside
$111 million for credit losses, up from $97 million a year earlier,
but down from the $184 million in the first quarter.
Shares in the company, up 3.7% in the past three months, were
inactive in premarket trading.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
July 21, 2016 07:35 ET (11:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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