Summary
This 8-K filing by BB&T Corporation (the registrant, which would later become Truist Financial Corp.) on May 15, 2012, announces the company's decision to redeem several series of its trust preferred securities. The redemptions are being made at BB&T's option, as these securities are callable. A key implication for investors and the company is that these trust preferred securities will no longer count towards BB&T's Tier 1 capital under regulatory guidelines upon redemption notice. This action aligns with BB&T's capital plan submitted to the Federal Reserve Board and will be funded using existing corporate reserves.
Key Highlights
- 1BB&T Corporation is redeeming multiple series of trust preferred securities.
- 2The redemptions are optional, as the securities are callable by BB&T.
- 3Redeemed trust preferred securities will cease to qualify as Tier 1 capital for regulatory purposes.
- 4This action is in line with BB&T's capital plan submitted to the Federal Reserve Board.
- 5The redemptions will be funded by BB&T's general corporate reserves.
- 6Specific redemption dates range from June 15, 2012, to June 30, 2012.
- 7Securities will be redeemed at 100% of their principal amount plus accrued distributions.
Frequently Asked Questions
BB&T is redeeming these securities because they are callable, and the company has opted to do so. This action is part of its capital management strategy and aligns with its capital plan submitted to the Federal Reserve, as these securities will no longer qualify as Tier 1 capital.
Upon redemption, these trust preferred securities will no longer count towards BB&T's Tier 1 regulatory capital. This is a strategic move to optimize its capital structure according to evolving regulatory requirements.
The redemptions will be funded using BB&T's general corporate reserves, indicating the company has sufficient liquidity to manage these buybacks without external financing.
Holders will receive 100% of the principal amount of their trust preferred securities, plus any accrued and unpaid distributions up to the specified redemption date.