10-KPeriod: FY2011

TRUIST FINANCIAL CORP Annual Report, Year Ended Dec 31, 2011

Filed February 27, 2012For Securities:TFCTFC-POTFC-PRTFC-PI

Summary

Truist Financial Corporation (TFC), formerly BB&T Corporation, reported solid performance in its 2011 10-K filing, navigating a complex economic environment with notable improvements in credit quality and strategic growth initiatives. The company demonstrated resilience by increasing net income available to common shareholders by 58% to $1.3 billion, translating to diluted earnings per share of $1.83. This financial uplift was supported by a significant reduction in nonperforming assets and a strategic focus on enhancing the deposit mix, with noninterest-bearing deposits growing by 24.5%. BB&T continued to execute its growth strategy through both organic expansion and strategic acquisitions, notably announcing its agreement to acquire BankAtlantic. The company also maintained a strong capital position, with its risk-based capital ratios well above regulatory requirements, positioning it favorably for future stability and shareholder returns. Despite challenges from economic headwinds and evolving regulatory landscapes, BB&T's management highlighted improved loan and deposit growth, alongside strong performance in specialized lending and other fee-income generating businesses, indicating a positive trajectory entering the subsequent fiscal year.

Financial Highlights

40 data points
Beta

Net Income

$1.29B

EPS (Diluted)

$1.83

Total Assets

$174.58B

Cash & Equivalents

$3.58B

Free Cash Flow

$4.05B

Financial Statements
Beta
Interest Expense$1.38B
Net Income$1.29B
EPS (Basic)$1.85
EPS (Diluted)$1.83
Shares Outstanding (Basic)696.53M
Shares Outstanding (Diluted)705.17M

Key Highlights

  • 1Net income available to common shareholders increased by 58% to $1.3 billion, with diluted earnings per share at $1.83.
  • 2Nonperforming assets (excluding covered foreclosed property) decreased by $1.5 billion (38.3%), significantly improving credit quality.
  • 3Total end-of-period deposits increased by 16.5% to $124.9 billion, with a favorable shift towards noninterest-bearing deposits.
  • 4Total end-of-period loans grew by 3.7% to $111.2 billion, showing accelerated growth and improved diversification.
  • 5Announced agreement to acquire BankAtlantic for approximately $2.1 billion in loans and $3.3 billion in deposits, excluding nonperforming assets.
  • 6Strong performance reported in specialized lending, large corporate banking, wealth management, payment services, and direct retail lending.
  • 7Capital ratios (Tier 1 common, Tier 1 risk-based, and total risk-based) remained well above regulatory standards for well-capitalized banks.

Frequently Asked Questions

BB&T saw significant improvement in its credit quality during 2011. Nonperforming assets, excluding covered foreclosed property, declined by $1.5 billion or 38.3%. Nonaccrual loans and leases, net of covered assets, decreased to $1.87 billion from $2.67 billion in the prior year. Loans 90 days or more past due and still accruing interest (excluding covered loans) also declined by 31.5%.

BB&T continued to pursue a strategy of expanding and diversifying its franchise through both organic growth and strategic acquisitions. In 2011, the company announced an agreement to acquire BankAtlantic, a Florida-based bank, which was expected to be accretive to earnings per share in 2012 (excluding merger costs). Additionally, BB&T announced the acquisition of the life and property and casualty insurance operating divisions of Crump Group Inc. for $570 million, a move expected to add approximately $300 million in annual revenue.

BB&T maintained a strong capital position throughout 2011. Its Tier 1 common equity ratio was 9.7% at December 31, 2011, an increase from 9.1% in the prior year. The Tier 1 risk-based capital ratio was 12.5% and the total risk-based capital ratio was 15.7%. These ratios were well above the regulatory minimums required to be considered 'well-capitalized', demonstrating a solid foundation for future operations and growth.

The company identified several key challenges including slow economic growth in the U.S. and the impact of the European crisis, intense competition within the financial services industry, and the costs and risks associated with regulatory initiatives, particularly the ongoing implementation of the Dodd-Frank Act. The company noted that the Dodd-Frank Act's provisions, including those limiting interchange fees, could negatively impact revenues and earnings.