<PAGE>
PROSPECTUS SUPPLEMENT PURSUANT TO RULE NO. 424(b)(2)
(TO PROSPECTUS DATED MAY 10, 1996) REGISTRATION NO. 333-02899
$250,000,000
BB&T CORPORATION
7 1/4% SUBORDINATED NOTES DUE 2007
Interest on the Subordinated Notes offered hereby (the "Subordinated Notes")
is payable semi-annually on June 15 and December 15 of each year, beginning
December 15, 1997. The Subordinated Notes are not redeemable prior to maturity
and will mature on June 15, 2007.
The Subordinated Notes are unsecured and subordinated to all present and
future senior indebtedness of the Company. Payment of principal of the
Subordinated Notes may be accelerated only in the case of the bankruptcy of
the Company. There is no right of acceleration in the case of a default in the
payment of interest on the Subordinated Notes or in the performance of any
covenant or agreement of the Company with respect to the Subordinated Notes.
See "Subordinated Debt Securities--Limited Rights of Acceleration" and "--
Events of Default" in the accompanying Prospectus.
The Subordinated Notes will be issued only in fully registered form and will
be represented by one or more Global Securities registered in the name of a
nominee of The Depository Trust Company, as Depositary (the "Depositary").
Beneficial interests in the Subordinated Notes will be shown on, and transfers
thereof will be effected only through, the records maintained by the
Depositary's participants. Owners of beneficial interests in the Global
Securities will be entitled to physical delivery of Subordinated Notes in
certificated form equal in principal amount to their respective beneficial
interests only under limited circumstances. The Subordinated Notes will trade
in the Depositary's Same-Day Funds Settlement System until maturity, and
secondary market trading activity for the Subordinated Notes will therefore
settle in immediately available funds. All payments of principal and interest
will be made by the Company in immediately available funds. See "Description
of the Debt Securities--Global Securities," "Description of Subordinated
Notes--Global Securities" and "--Same-Day Settlement and Payment."
----------------
THE SUBORDINATED NOTES OFFERED HEREBY ARE NOT SAVINGS OR DEPOSIT ACCOUNTS OR
OTHER OBLIGATIONS OF A BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT(2) COMPANY(1)(3)
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Subordinated Note................. 99.533% 0.650% 98.883%
- -------------------------------------------------------------------------------
Total................................. $248,832,500 $1,625,000 $247,207,500
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(1) Plus accrued interest, if any, from June 6, 1997.
(2) The Company has agreed to indemnify the several Underwriters against
certain liabilities under the Securities Act of 1933, as amended. See
"Underwriting."
(3) Before deducting expenses payable by the Company estimated at $200,000.
----------------
The Subordinated Notes are offered subject to receipt and acceptance by the
Underwriters, to prior sale and to the Underwriters' right to reject any order
in whole or in part and to withdraw, cancel or modify the offer without
notice. It is expected that the Subordinated Notes will be ready for delivery
in book-entry form only through the facilities of The Depository Trust Company
in New York, New York on or about June 6, 1997, against payment therefor in
immediately available funds.
BEAR, STEARNS & CO. INC.
ALEX. BROWN & SONS
INCORPORATED
CRAIGIE INCORPORATED
The date of this Prospectus Supplement is June 3, 1997.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE
SUBORDINATED NOTES, INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING
TRANSACTIONS AND THE IMPOSITION OF PENALTY BIDS. SEE "UNDERWRITING."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following reports filed by the Company with the Securities and Exchange
Commission (the "Commission") (File No. 1-10853) under Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
hereby incorporated by reference in the Prospectus as supplemented by this
Prospectus Supplement:
(i) Annual Report on Form 10-K for the year ended December 31, 1996;
(ii) Quarterly Report on Form 10-Q for the quarter ended March 31, 1997;
(iii) Current Report on Form 8-K filed with the Commission on April 11,
1997; and
(iv) Current Report on Form 8-K filed with the Commission on May 23,
1997.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date hereof and prior to the
termination of the offering of the Subordinated Notes are hereby incorporated
by reference into the Prospectus as supplemented by this Prospectus Supplement
and shall be deemed a part hereof from the date of filing of such documents.
Any statement contained in the Prospectus, in this Prospectus Supplement or in
a document incorporated or deemed to be incorporated by reference therein or
herein shall be deemed to be modified or superseded for purposes of the
Registration Statement (as defined in the Prospectus) and the Prospectus as
supplemented by this Prospectus Supplement to the extent that a statement
contained in the Prospectus, in this Prospectus Supplement or in any
subsequently filed document which also is or is deemed to be incorporated by
reference in the Prospectus as supplemented by this Prospectus Supplement
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of the Registration Statement, the Prospectus or this
Prospectus Supplement.
The Company will provide without charge to each person to whom a copy of
this Prospectus as supplemented by this Prospectus Supplement is delivered,
upon the written or oral request of such person, a copy of any or all of the
documents incorporated by reference in the Prospectus as supplemented by this
Prospectus Supplement, except for certain exhibits to such documents. Written
requests should be sent to Investor Relations, BB&T Corporation, 223 West Nash
Street, Wilson, North Carolina 27893. Telephone requests may be directed to
(919) 246-4219.
S-2
<PAGE>
THE COMPANY
BB&T Corporation ("BB&T" or the "Company") is a multi-bank holding company
headquartered in Winston-Salem, North Carolina. The Company changed its name
from Southern National Corporation to BB&T Corporation on May 16, 1997. It
conducts its operations in North Carolina, South Carolina and Virginia
primarily through its commercial banking subsidiaries, which operate 423
banking offices, and, to a lesser extent, through its other subsidiaries.
Substantially all of the Company's loans are to businesses and individuals in
the Carolinas and Virginia. The Company's principal subsidiaries are Branch
Banking and Trust Company ("BB&T-NC"); BB&T Financial Corporation of South
Carolina, which in turn owns all the outstanding shares of Branch Banking and
Trust Company of South Carolina ("BB&T-SC"); BB&T Financial Corporation of
Virginia ("BB&T Financial-VA"), which in turn owns all the outstanding shares
of Branch Banking and Trust Company of Virginia ("BB&T-VA") and Fidelity
Federal Savings Bank ("FFSB"); and Regional Acceptance Corporation,
headquartered in Greenville, North Carolina ("Regional Acceptance"). At March
31, 1997, the Company had assets of $22.1 billion, deposits of $15.6 billion,
loans of $15.4 billion and shareholders' equity of $1.8 billion and ranked
thirty-sixth among bank holding companies in the United States in terms of
assets and thirty-fourth in terms of deposits.
BB&T-NC, the Company's largest subsidiary, is the oldest bank in North
Carolina. At March 31, 1997, BB&T-NC had assets of $17.0 billion, deposits of
$12.2 billion, loans of $11.7 billion and shareholder's equity of $1.3 billion
and ranked third among banks in North Carolina in terms of deposits. Serving
North Carolina through 300 banking offices, BB&T-NC focuses on providing a
wide range of banking services in its local market for retail commercial
customers, including small and mid-size businesses, public agencies and local
governments, trust customers and individuals. BB&T-NC has numerous additional
subsidiaries which engage in leasing, investment, insurance and other
activities. Among such subsidiaries is BB&T Insurance Services, Inc., which
has assembled the largest independent insurance agency system in the
Carolinas.
BB&T-SC serves South Carolina through 95 banking offices and focuses on
providing a wide range of banking services in its local market for retail and
commercial customers, including small and mid-size businesses, public
agencies, local governments, trust customers and individuals. BB&T-SC's
subsidiaries include BB&T Investment Services of South Carolina, Inc., which
is licensed as a general broker/dealer of securities and is currently engaged
in retailing of mutual funds, U.S. Government securities, municipal
securities, fixed and variable insurance annuity products and unit investment
trusts. At March 31, 1997, BB&T-SC had assets of $3.9 billion, deposits of
$3.1 billion, loans of $2.7 billion and shareholder's equity of $317.5 million
and ranked third among banks in South Carolina in terms of deposits.
BB&T-VA offers a full range of commercial and retail banking services
through 21 banking offices in the Hampton Roads region of southeastern
Virginia. At March 31, 1997, BB&T-VA had assets of $762.5 million, deposits of
$658.4 million, loans of $556.4 million and shareholder's equity of $68.3
million and ranked tenth among banks in Virginia in terms of deposits. On
March 1, 1997, the Company acquired FFSB, which has seven retail banking
offices and provides the Company with an initial presence in the Richmond,
Virginia market. At March 31, 1997, FFSB had assets of $362.3 million,
deposits of $255.7 million, loans of $279.0 million and shareholder's equity
of $63.3 million. It is anticipated that FFSB will merge into BB&T-VA not
later than the first quarter of 1998.
Regional Acceptance, acquired by the Company effective September 1, 1996,
specializes in indirect financing of purchases of mid-model and late-model
used automobiles by consumers with limited access to traditional sources of
credit. It operates 28 branch offices in the Carolinas, Tennessee and
Virginia. At March 31, 1997, Regional Acceptance had assets of $175.8 million,
loans of $166.3 million and shareholder's equity of $44.8 million.
The Company is continuing to develop its franchise through the acquisition
of financial institutions in North Carolina, South Carolina and Virginia
pursuant to transactions which are expected to be consummated in 1997. These
acquisitions will significantly increase the Company's market share in North
Carolina and continue the expansion of the Company's presence in South
Carolina and Virginia. See "Recent Developments--Pending Acquisitions and
Other Developments" and "Pro Forma Condensed Financial Information."
S-3
<PAGE>
RECENT DEVELOPMENTS
FIRST QUARTER FINANCIAL RESULTS
The Company reported net income of $83.1 million for the quarter ended March
31, 1997 compared to net income of $71.9 million recorded in the first quarter
of 1996, representing an increase of 15.6%. The increase in net income
reflected a 9.1% increase in net interest income and a 24.0% increase in
noninterest income, while noninterest expenses increased 7.6%. Returns on
average assets and average common equity in the first quarter of 1997 were
1.58% and 19.16%, respectively.
The Company's net interest income was $217.8 million for the first quarter
of 1997 compared to $199.6 million in the first quarter of 1996. The Company's
net interest income increased as a result of an increase of 5.7% in average
interest-earning assets and a higher net interest margin. Total interest
income was $415.8 million for the first quarter of 1997, an increase of $24.1
million from $391.7 million in the comparable 1996 period. Total interest
expense was $198.0 million in the first quarter of 1997 compared to $192.1
million in the first quarter of 1996, an increase of $5.9 million. During the
first quarter of 1997, average interest-earning assets were $20.1 billion
compared to $19.0 billion for the first quarter of 1996. Average interest-
bearing liabilities during the first quarter of 1997 were $17.5 billion
compared to $16.4 billion during the first quarter of 1996, an increase of
$1.1 billion. The net interest margin in the first quarter of 1997 improved to
4.56% from 4.38% in the first quarter of 1996.
The Company's provision for loan and lease losses was $17.0 million in the
first quarter of 1997 compared to $11.4 million in the first quarter of 1996.
Net charge-offs in the first quarter of 1997 were 0.29% of average loans and
leases compared to 0.23% in the first quarter of 1996 and 0.44% in the fourth
quarter of 1996. The Company's allowance for loan and lease losses was 1.26%
of total loans and leases and 3.36 times nonaccrual loans and leases at the
end of the first quarter of 1997, compared to 1.26% and 2.72 times,
respectively, at the end of the first quarter of 1996. Nonperforming assets
were $81.0 million, or 0.37% of total assets, at March 31, 1997 compared to
$77.1 million, or 0.38% of total assets, at March 31, 1996.
Total noninterest income increased 24.0% in the first quarter of 1997 to
$85.5 million from $69.0 million in the first quarter of 1996. Service charges
on deposits, the primary component of noninterest income, increased 21.4% in
the first quarter of 1997 over the comparable 1996 period. Other nondeposit
fees and commissions were $18.7 million in the first quarter of 1997 compared
to $15.6 million in the first quarter of 1996, an increase of 19.8%. Income
from mortgage banking activities in the first quarter of 1997 increased $1.2
million or 12.8% over the comparable 1996 period. Insurance agency commissions
increased $3.7 million or 60.0% in the first quarter of 1997 over the
comparable 1996 period, reflecting increases in property and casualty
insurance commissions and insurance fees and charges attributable in part to
the acquisitions of three insurance agencies in the fourth quarter of 1996.
Total noninterest expense increased 7.6% in the first quarter of 1997 to
$161.0 million from $149.6 million in the first quarter of 1996.
PENDING ACQUISITIONS AND OTHER DEVELOPMENTS
The Company has entered into an Agreement and Plan of Reorganization, dated
as of November 1, 1996, with United Carolina Bancshares Corporation ("UCB"),
which provides for the merger of UCB with and into the Company (the "UCB
Merger"). Through its banking subsidiaries, UCB operates 139 banking offices
in North Carolina and 16 banking offices in South Carolina. The shareholders
of the Company and UCB have approved the transaction, which remains subject to
regulatory approvals and other customary closing conditions. The Company
expects the merger to be effective July 1, 1997. At March 31, 1997, UCB had
assets of $4.5 billion, deposits of $4.0 billion, loans of $3.2 billion and
shareholders' equity of $358.8 million. On a pro forma basis as of March 31,
1997, the combined deposits of the Company and UCB would give the Company the
leading share of deposits in North Carolina and the third largest share of
deposits in South Carolina.
The Company has entered into an Agreement and Plan of Reorganization, dated
as of May 6, 1997, with Virginia First Financial Corporation ("Virginia
First"), which provides for the merger of Virginia First with and into BB&T
Financial-VA. Virginia First operates 24 banking offices through its
subsidiary, Virginia First
S-4
<PAGE>
Savings Bank. The merger is subject to approval of the shareholders of
Virginia First, regulatory approvals and other customary closing conditions.
The Company expects the merger to be effective in the fourth quarter of 1997.
At March 31, 1997, Virginia First had assets of $817.3 million, deposits of
$595.1 million, loans of $731.0 million and shareholders' equity of $65.9
million.
The Company has entered into an Agreement and Plan of Reorganization, dated
as of March 7, 1997, with Craigie Incorporated ("Craigie"), one of the
Underwriters for this offering, pursuant to which a newly formed subsidiary of
the Company will merge with and into Craigie and Craigie will survive as a
wholly owned subsidiary of the Company. With offices in Richmond, Virginia and
Charlotte, North Carolina, Craigie specializes in the organization, trading
and distribution of fixed income and equity products in both the public and
private capital markets. The merger is subject to the approval of Craigie's
shareholders, regulatory approvals and other customary closing conditions. The
Company expects the merger to be effective during the third quarter of 1997.
The Company expects to continue to take advantage of the consolidation of
the financial services industry by further developing its franchise through
the acquisition of financial institutions. Such acquisitions may entail the
payment by the Company of consideration in excess of the book value of the
underlying net assets acquired, may result in the issuance of additional
shares of the Company's capital stock or the incurring of additional
indebtedness by the Company, and could have a dilutive effect on the earnings
or book value per share of the Company's common stock. Moreover, such
acquisitions sometimes result in significant charges against earnings,
although cost savings, especially incident to in-market acquisitions, also are
frequently anticipated.
In January 1997, the Company announced the approval of a new plan to
repurchase up to 5 million shares of its common stock to be used as needed for
issuance in specific business combinations to be accounted for as purchases.
Through May 21, 1997, approximately 1.2 million shares had been repurchased
pursuant to this plan. The more significant acquisitions consummated or
anticipated to be consummated in 1997 as purchase business combinations
include the acquisition of FFBC (the parent of FFSB) on March 1, 1997 and the
pending acquisitions of Craigie and Virginia First.
In April 1997, the Company announced the approval of another new plan to
repurchase shares of its common stock in connection with the UCB Merger, which
is to be accounted for as a pooling of interests. Approximately 2.8 million
shares are likely to be repurchased before the anticipated effective date of
the UCB Merger on July 1, 1997. However, the actual number of shares
repurchased cannot exceed the maximum allowable under pooling-of-interests
accounting criteria. As of May 27, 1997, approximately 178,000 shares had been
repurchased pursuant to this plan.
S-5
<PAGE>
USE OF PROCEEDS
The net proceeds from the sale of the Subordinated Notes will be
approximately $247 million, after deducting the underwriting discount and
estimated offering expenses. The Company currently intends to use the net
proceeds from the offering for general corporate purposes, including
approximately $235 million for the repurchase of up to approximately 5.7
million shares of the Company's common stock in connection with certain
pending business combinations which are expected to be consummated in 1997.
Approximately $12 million of the net proceeds will be used to fund a portion
of the cash component of the purchase price to be paid by the Company in
connection with the acquisition of Virginia First. The Company intends to
finance the balance of the cash component (approximately $33 million) through
the issuance of additional indebtedness. See "Recent Developments--Pending
Acquisitions and Other Developments."
Pending use as described above, the net proceeds may be temporarily invested
or used to reduce short-term indebtedness. The precise amounts and timing of
the application of proceeds will depend upon the funding requirements of the
Company and its subsidiaries and the availability of other funds.
Based upon the historical and anticipated future growth of the Company and
the financial needs of the Company and its subsidiaries, the Company may
engage in additional financings of a character and amount to be determined as
the need arises.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following are the Company's consolidated ratios of earnings to fixed
charges for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, YEAR ENDED DECEMBER 31,
--------------- ----------------------------
1997 1996 1996 1995 1994 1993 1992
------- ------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings to fixed charges:
Excluding interest on
deposits.................... 3.10x 2.99x 2.88x 2.04x 3.45x 3.29x 4.06x
Including interest on
deposits.................... 1.62 1.55 1.53 1.34 1.63 1.40 1.39
</TABLE>
For purposes of computing these ratios, earnings represent income from
continuing operations before extraordinary items and cumulative effects of
changes in accounting principles plus income taxes and fixed charges
(excluding capitalized interest). Fixed charges, excluding interest on
deposits, represent interest (other than on deposits, but including
capitalized interest), one-third (the proportion representative of the
interest factor) of rents and all amortization of debt issuance costs. Fixed
charges, including interest on deposits, represent all interest, one-third
(the proportion representative of the interest factor) of rents and all
amortization of debt issuance costs.
S-6
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The following table sets forth certain consolidated financial data of the
Company for the five years ended December 31, 1996, and the three months ended
March 31, 1997 and March 31, 1996. The information is qualified in its
entirety by the detailed information and consolidated financial statements
included in the documents incorporated herein by reference. See "Incorporation
of Certain Documents by Reference" in this Prospectus Supplement and the
accompanying Prospectus.
<TABLE>
<CAPTION>
AS OF OR FOR THE THREE
MONTHS ENDED
MARCH 31, AS OF OR FOR THE YEARS ENDED DECEMBER 31,
------------------------ ------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
----------- ----------- -------- -------- -------- -------- --------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
SUMMARY OF OPERATIONS:
Interest income........ $ 416 $ 392 $ 1,607 $ 1,577 $ 1,339 $ 1,213 $ 1,218
Interest expense....... 198 192 778 814 586 509 592
----------- ----------- -------- -------- -------- -------- --------
Net interest income.... 218 200 829 763 753 704 626
Provision for loan and
lease losses.......... 17 11 54 35 20 55 64
----------- ----------- -------- -------- -------- -------- --------
Net interest income
after provision for
loan and lease
losses................ 201 189 775 728 733 649 562
Noninterest income..... 85 69 297 231 230 223 188
Noninterest expense.... 161 150 654 681 590 667 514
----------- ----------- -------- -------- -------- -------- --------
Income before income
taxes................. 125 108 418 278 373 205 236
Provision for income
taxes................. 42 36 134 92 129 79 84
----------- ----------- -------- -------- -------- -------- --------
Income before cumula-
tive effect of changes
in accounting princi-
ples.................. 83 72 284 186 244 126 152
Less: cumulative effect
of changes in
accounting principles,
net of income taxes... -- -- -- -- -- 34 --
----------- ----------- -------- -------- -------- -------- --------
Net income............. $ 83 $ 72 $ 284 $ 186 $ 244 $ 92 $ 152
=========== =========== ======== ======== ======== ======== ========
SELECTED PERIOD END
BALANCES:
Total assets........... $ 22,052 $ 20,329 $ 21,247 $ 20,636 $ 19,972 $ 18,928 $ 16,016
Earning assets......... 20,730 19,059 19,847 19,376 18,803 17,721 14,887
Securities............. 5,345 4,835 5,262 5,355 5,425 5,225 4,208
Loans and leases(1).... 15,349 14,210 14,584 13,952 13,052 12,132 10,433
Deposits............... 15,556 15,163 14,954 14,684 14,314 14,595 13,044
Long-term debt......... 2,273 1,603 2,052 1,384 911 837 423
Shareholders' equity... 1,753 1,603 1,729 1,711 1,526 1,421 1,276
SELECTED FINANCIAL
RATIOS:
PROFITABILITY RATIOS:
Return on average as-
sets.................. 1.58% 1.43% 1.38% .91% 1.28% .54% .98%
Return on average com-
mon shareholders' eq-
uity.................. 19.16 17.99 17.21 11.84 17.07 6.61 12.99
Net interest margin.... 4.56 4.38 4.45 4.14 4.36 4.55 4.53
Efficiency............. 51.3 53.8 53.5 55.2 58.0 66.0 61.9
CAPITAL RATIOS:
Equity to assets (pe-
riod end)............. 8.0% 7.9% 8.1% 8.3% 7.6% 7.5% 8.0%
Tier 1 capital......... 10.7 12.3 11.7 13.2 12.4 N/A N/A
Total capital.......... 13.6 13.5 14.7 14.4 13.4 N/A N/A
Leverage............... 7.8 7.7 8.0 7.9 7.1 N/A N/A
LOAN QUALITY RATIOS:
Nonaccrual loans and
leases as a percentage
of total loans and
leases................ .38% .46% .41% .45% .36% .51% .87%
NONPERFORMING ASSETS AS
A PERCENTAGE OF:
Total assets........... .37 .38 .38 .37 .31 .46 .98
Loans and leases plus
foreclosed property... .53 .54 .55 .54 .47 .72 1.50
Net charge-offs as a
percentage of average
loans and leases...... .29 .23 .32 .24 .14 .32 .47
Allowance for loan and
lease losses as a
percentage of loans
and leases............ 1.26 1.26 1.26 1.26 1.32 1.41 1.31
RATIO OF ALLOWANCE FOR
LOAN AND LEASE LOSSES
TO:
Net charge-offs........ 4.45x 5.49x 4.06x 5.30x 9.68x 4.81x 2.86x
Nonaccrual loans and
leases................ 3.36 2.72 3.08 2.82 3.59 2.75 1.50
</TABLE>
- --------
(1) Loans and leases are net of unearned income and the allowance for losses.
Amounts include loans held for sale.
N/A--Not available
S-7
<PAGE>
PRO FORMA CONDENSED FINANCIAL INFORMATION
The following Pro Forma Condensed Financial Information and explanatory
notes are presented to show the impact on the Company's historical financial
position of the pending UCB Merger and the impact on the Company's results of
operations of the pending UCB Merger and the acquisition on March 1, 1997 of
Fidelity Financial Bankshares Corporation ("FFBC"), the former parent of FFSB
headquartered in Richmond, Virginia (the "FFBC Merger"). The UCB Merger is
reflected in the Pro Forma Condensed Financial Information under the pooling-
of-interests method of accounting, and the FFBC Merger is reflected under the
purchase method of accounting. See "Recent Developments--Pending Acquisitions
and Other Developments."
The Pro Forma Condensed Balance Sheet presented assumes that the UCB Merger
was consummated on March 31, 1997 and the Pro Forma Condensed Income
Statements assume that the UCB Merger and the FFBC Merger were consummated at
the beginning of each period presented, except where noted.
The Company acquired three insurance agencies in the fourth quarter of 1996
which were accounted for under the purchase method of accounting. The Company
issued 610,390 shares of common stock to effect the acquisitions and recorded
intangible assets of $17.9 million. Substantially all of these shares were
repurchased prior to the consummation of these transactions. These amounts are
not reflected in the Pro Forma Condensed Balance Sheet contained herein. The
intangible assets recorded would result in amortization expense of $298,000
for the three months ended March 31, 1997 and $1.2 million for the year ended
December 31, 1996. These amounts are not reflected in the Pro Forma Condensed
Income Statements contained herein.
The pro forma balances are not necessarily indicative of the results had the
UCB Merger and the FFBC Merger occurred at the beginning of the periods
presented, nor are they necessarily indicative of the results of future
operations.
S-8
<PAGE>
CONSOLIDATED PRO FORMA CONDENSED BALANCE SHEET
MARCH 31, 1997
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
PRO FORMA ADJUSTMENTS BB&T AND UCB
------------------------------- PRO FORMA
BB&T UCB DEBIT CREDIT COMBINED
----------- ---------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C>
ASSETS
Cash and due from
banks.................. $ 552,111 $ 150,980 $ $ $ 703,091
Interest-bearing
deposits with banks.... 8,327 -- 8,327
Federal funds sold and
securities purchased
under resale agreements
or similar
arrangements........... 21,022 92,632 113,654
Securities available for
sale................... 5,222,841 869,359 6,092,200
Securities held to
maturity............... 122,182 44,417 166,599
Loans held for sale..... 264,625 -- 264,625
Loans and leases, net of
unearned income........ 15,084,615 3,215,839 208,755(1) 18,091,699
Allowance for loan and
lease losses........... (193,987) (48,266) (242,253)
----------- ---------- ---------- ---------- -----------
Loans and leases, net... 14,890,628 3,167,573 208,755 17,849,446
----------- ---------- ---------- ---------- -----------
Premises and equipment,
net.................... 328,862 54,759 383,621
Other assets............ 641,597 108,119 7,660(2) 742,056
----------- ---------- ---------- ---------- -----------
Total assets............ $22,052,195 $4,487,839 $ $ 216,415 $26,323,619
=========== ========== ========== ========== ===========
LIABILITIES AND
SHAREHOLDERS' EQUITY
Noninterest-bearing
demand deposits........ $ 2,009,401 $ 609,696 $ 52,189(1) $ $ 2,566,908
Savings and interest
checking............... 1,430,386 630,692 2,061,078
Money rate savings...... 3,722,006 846,382 4,568,388
Other time deposits..... 8,394,303 1,951,882 469,698(1) 9,876,487
----------- ---------- ---------- ---------- -----------
Total deposits.......... 15,556,096 4,038,652 521,887 19,072,861
Short-term borrowed
funds.................. 2,183,091 39,862 2,222,953
Long-term debt.......... 2,273,288 2,251 2,275,539
Accounts payable and
other liabilities...... 286,283 48,226 354,858(1)(3)(4) 689,367
----------- ---------- ---------- ---------- -----------
Total liabilities....... 20,298,758 4,128,991 521,887 354,858 24,260,720
----------- ---------- ---------- ---------- -----------
SHAREHOLDERS' EQUITY:
Preferred stock, $5 par,
5,000,000 shares
authorized, none issued
and outstanding at
December 31, 1996...... -- -- --
Common stock, $5 par,
300,000,000 shares
authorized, 109,138,628
issued and outstanding
at March 31, 1997,
136,817,658 shares pro
forma issued and
outstanding,
respectively........... 545,693 97,547 40,848(5) 684,088
Additional paid-in
capital................ 122,274 52,722 40,848(5) 134,148
Retained earnings....... 1,091,507 210,488 49,386(2)(3)(4) 1,252,609
Loan to employee stock
ownership plan and
unvested restricted
stock.................. (1,935) -- (1,935)
Net unrealized
appreciation on
securities available
for sale............... (4,102) (1,909) (6,011)
----------- ---------- ---------- ---------- -----------
Total shareholders'
equity................. 1,753,437 358,848 90,234 40,848 2,062,899
----------- ---------- ---------- ---------- -----------
Total liabilities and
shareholders' equity... $22,052,195 $4,487,839 $ 612,121 $ 395,706 $26,323,619
=========== ========== ========== ========== ===========
</TABLE>
See Notes to Pro Forma Condensed Financial Information.
S-9
<PAGE>
CONSOLIDATED PRO FORMA CONDENSED INCOME STATEMENT
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
BB&T AND BB&T,
FFBC PRO FFBC AND UCB
PRO FORMA FORMA PRO FORMA
BB&T FFBC(6) ADJUSTMENTS COMBINED UCB(7) COMBINED(7)
----------- ------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
INTEREST INCOME
Interest and fees on
loans and losses...... $ 332,269 $4,047 $ 336,316 $ 71,581 $ 407,897
Interest and dividends
on securities......... 83,292 347 83,639 13,438 97,077
Interest on short-term
investments........... 258 75 333 717 1,050
----------- ------ ----- ----------- ---------- -----------
Total interest in-
come................. 415,819 4,469 420,288 85,736 506,024
----------- ------ ----- ----------- ---------- -----------
INTEREST EXPENSE
Interest on deposits... 140,950 1,892 142,842 38,377 181,219
Interest of short-term
borrowed funds........ 26,971 103 27,074 328 27,402
Interest on long-term
debt.................. 30,099 307 30,406 29 30,435
----------- ------ ----- ----------- ---------- -----------
Total interest ex-
pense................ 198,020 2,302 200,322 38,734 239,056
----------- ------ ----- ----------- ---------- -----------
NET INTEREST INCOME..... 217,799 2,167 219,966 47,002 266,968
Provision for loan and
lease losses.......... 17,000 120 17,120 3,850 20,970
----------- ------ ----- ----------- ---------- -----------
NET INTEREST INCOME
AFTER PROVISION FOR
LOAN AND LEASE LOSSES.. 200,799 2,047 202,846 43,152 245,998
----------- ------ ----- ----------- ---------- -----------
NONINTEREST INCOME
Service charges on de-
posit accounts........ 30,600 46 30,646 5,855 36,501
Mortgage banking activ-
ities................. 10,486 (3) 10,483 1,267 11,750
Trust income........... 5,344 -- 5,344 1,514 6,858
Agency and other insur-
ance commissions...... 12,959 -- 12,959 1,893 14,852
Other nondeposit fees
and commissions....... 18,720 21 18,741 2,849 21,590
Securities gains (loss-
es), net.............. 811 -- 811 4 815
Other noninterest in-
come.................. 6,593 8 6,601 295 6,896
----------- ------ ----- ----------- ---------- -----------
Total noninterest in-
come................. 85,513 72 85,585 13,677 99,262
----------- ------ ----- ----------- ---------- -----------
NONINTEREST EXPENSE
Personnel expense...... 81,058 666 81,724 21,128 102,852
Occupancy and equipment
expense............... 26,776 205 26,981 4,333 31,314
Federal deposit insur-
ance expense.......... 1,135 27 1,162 -- 1,162
Other noninterest ex-
penses................ 52,073 303 636(8) 53,012 10,622 63,634
----------- ------ ----- ----------- ---------- -----------
Total noninterest ex-
pense................ 161,042 1,201 636 162,879 36,083 198,962
----------- ------ ----- ----------- ---------- -----------
EARNINGS
Income before income
taxes................. 125,270 918 (636) 125,552 20,746 146,298
Income tax expense..... 42,202 346 42,548 7,467 50,015
----------- ------ ----- ----------- ---------- -----------
Net income............. $ 83,068 $ 572 $(636) $ 83,004 $ 13,279 $ 96,283
=========== ====== ===== =========== ========== ===========
PER COMMON SHARE
Net income:
Primary................ $ .74 $ .74 $ .55 $ .69
=========== ====== ===== =========== ========== ===========
Fully diluted.......... $ .74 $ .74 $ .55 $ .69
=========== ====== ===== =========== ========== ===========
AVERAGE SHARES OUTSTAND-
ING
Primary................ 111,554,075 111,554,075 24,360,323 139,203,042
=========== ====== ===== =========== ========== ===========
Fully diluted.......... 111,554,075 111,554,075 24,360,323 139,203,042
=========== ====== ===== =========== ========== ===========
</TABLE>
See Notes to Pro Forma Condensed Financial Information.
S-10
<PAGE>
CONSOLIDATED PRO FORMA CONDENSED INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
BB&T AND BB&T,
FFBC PRO FFBC AND UCB
PRO FORMA FORMA PRO FORMA
BB&T FFBC ADJUSTMENTS COMBINED UCB(7) COMBINED(7)
----------- --------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
INTEREST INCOME
Interest and fees on
loans and leases...... $ 1,282,521 $ 23,659 $ 1,306,180 $ 272,301 $ 1,578,481
Interest and dividends
on securities......... 323,360 1,582 324,942 51,897 376,839
Interest on short-term
investments........... 732 1,322 2,054 4,741 6,795
----------- --------- ----------- ---------- -----------
Total interest in-
come................. 1,606,613 26,563 1,633,176 328,939 1,962,115
----------- --------- ----------- ---------- -----------
INTEREST EXPENSE
Interest on deposits... 564,747 11,746 576,493 147,744 724,237
Interest on short-term
borrowed funds........ 105,936 964 106,900 1,823 108,723
Interest on long-term
debt.................. 107,437 1,671 109,108 165 109,273
----------- --------- ----------- ---------- -----------
Total interest ex-
pense................ 778,120 14,381 792,501 149,732 942,233
----------- --------- ----------- ---------- -----------
NET INTEREST INCOME..... 828,493 12,182 840,675 179,207 1,019,882
Provision for loan and
lease losses.......... 53,661 3,050 56,711 8,850 65,561
----------- --------- ----------- ---------- -----------
NET INTEREST INCOME AF-
TER PROVISION FOR LOAN
AND LEASE LOSSES....... 774,832 9,132 783,964 170,357 954,321
----------- --------- ----------- ---------- -----------
NONINTEREST INCOME
Service charges on de-
posit accounts........ 107,581 -- 107,581 24,599 132,180
Mortgage banking activ-
ities................. 34,352 -- 34,352 5,493 39,845
Trust income........... 22,811 -- 22,811 5,983 28,794
Agency and other insur-
ance commissions...... 33,542 -- 33,542 6,139 39,681
Other nondeposit fees
and commissions....... 68,835 -- 68,835 9,456 78,291
Securities gains (loss-
es), net.............. 3,206 (211) 2,995 (116) 2,879
Other noninterest in-
come.................. 27,062 834 27,896 561 28,457
----------- --------- ----------- ---------- -----------
Total noninterest in-
come................. 297,389 623 298,012 52,115 350,127
----------- --------- ----------- ---------- -----------
NONINTEREST EXPENSE
Personnel expense...... 302,383 4,121 306,504 85,061 391,565
Occupancy and equipment
expense............... 103,594 1,347 104,941 17,525 122,466
Federal deposit insur-
ance expense.......... 42,820 2,004 44,824 1,227 46,051
Other noninterest ex-
pense................. 205,256 1,486 2,543(8) 209,285 48,900 258,185
----------- --------- ------- ----------- ---------- -----------
Total noninterest ex-
pense................ 654,053 8,958 2,543 665,554 152,713 818,267
----------- --------- ------- ----------- ---------- -----------
EARNINGS
Income before income
taxes................. 418,168 797 (2,543) 416,422 69,759 486,181
Income tax expense..... 134,504 307 134,811 24,555 159,366
----------- --------- ------- ----------- ---------- -----------
Net income............. 283,664 490 (2,543) 281,611 45,204 326,815
Preferred dividend re-
quirements............ 610 -- 610 -- 610
----------- --------- ------- ----------- ---------- -----------
Income applicable to
common shares......... $ 283,054 $ 490 $(2,543) $ 281,001 $ 45,204 $ 326,205
=========== ========= ======= =========== ========== ===========
PER COMMON SHARE
Net income
Primary................ 2.56 .21 2.51 1.87 2.34
=========== ========= =========== ========== ===========
Fully diluted.......... 2.54 .21 2.48 1.87 2.32
=========== ========= =========== ========== ===========
AVERAGE SHARES OUTSTAND-
ING
Primary................ 110,486,127 2,286,773 112,118,197 24,210,796 139,597,450
=========== ========= =========== ========== ===========
Fully diluted.......... 111,836,200 2,286,773 113,468,270 24,210,796 140,947,523
=========== ========= =========== ========== ===========
</TABLE>
See Notes to Pro Forma Condensed Financial Information.
S-11
<PAGE>
NOTES TO PRO FORMA CONDENSED FINANCIAL INFORMATION
Note 1. To reflect the transactions necessary to divest $521.9 million of
deposits and $208.8 million of loans in conjunction with the UCB
Merger. The net amount to be due at closing is recorded in other
liabilities.
Note 2. During May 1995, the Company and UCB entered into a transaction
wherein UCB acquired 12 North Carolina branch offices which were
required to be divested by the Company. In the acquisition, UCB
assumed $178.7 million in deposits and purchased $26.8 million in
loans from the Company. Two of the branch banking offices acquired by
UCB in the transaction with aggregate deposits and loans of $32.7
million and $4.9 million, respectively, were sold to third party banks
during the fourth quarter of 1995. UCB recorded a premium of $10.1
million for the assumed deposit base of the branches retained. The
Company recorded a total gain on divestiture of $12.3 million. This
adjustment eliminates the $7.7 million of unamortized deposit
intangible and the intercompany portion of the gain in the Pro Forma
Condensed Balance Sheet.
Note 3. Certain material, nonrecurring adjustments of approximately $50 to $60
million will be recorded in conjunction with the UCB Merger. These
adjustments include amounts to effect the settlement of obligations
under existing employment contracts, severance pay for involuntary
terminations, early retirement and related employee benefits; amounts
associated with branch closings and divestitures; and the
consolidation of bank operations and systems. It is estimated that $5
million of the expenses will be directly related to effecting the UCB
Merger and therefore will not be deductible for income tax purposes.
The impact of these adjustments (using a $55 million estimate) has
been reflected in the Pro Forma Condensed Balance Sheet as of March
31, 1997.
Note 4. UCB elected to amortize the accumulated postretirement obligation
related to the adoption of SFAS No. 106 over a period of 20 years as a
component of the postretirement benefit cost. The Company elected to
reflect the adoption of SFAS No. 106 through the recording of a
cumulative charge for this change in accounting principle. The Pro
Forma Condensed Balance Sheet reflects an adjustment to conform UCB's
transition method to the method elected by the Company. The
accompanying Pro Forma Condensed Income Statement does not reflect
adjustments for amounts previously recorded by UCB as amortization of
the unrecorded transition obligation, which amounted to $99,000 for
the quarter ended March 31, 1997 and $394,000 for the year ended
December 31, 1996.
Note 5. Based on an exchange ratio of 1.135 for the conversion of UCB common
stock into the Company's common stock. At March 31, 1997, UCB had
24,386,811 shares of common stock outstanding.
Note 6. The Company acquired FFBC on March 1, 1997. This Pro Forma Condensed
Income Statement includes the results of operations of FFBC from
January 1, 1997 through February 28, 1997. FFBC's results of
operations for the month of March 1997 are included in the BB&T
column.
Note 7. No pro forma adjustments relating to the UCB Merger are reflected in
the Pro Forma Condensed Income Statements.
Note 8. To record amortization of the $38.0 million recorded as goodwill,
which results from the excess of the purchase price over the estimated
fair market value of the net assets acquired from FFBC over a 15-year
period using the straight-line method.
S-12
<PAGE>
DESCRIPTION OF SUBORDINATED NOTES
The following description of the particular terms of the Subordinated Notes
offered hereby supplements, and to the extent inconsistent therewith replaces,
the description of the general terms and provisions of the Debt Securities and
the specific terms and conditions of the Subordinated Debt Securities set
forth in the accompanying Prospectus, to which description reference is hereby
made. Capitalized terms used and not defined herein have the meanings set
forth in the accompanying Prospectus.
The Subordinated Notes will be limited to $250,000,000 aggregate principal
amount, will be direct, unsecured, subordinated obligations of the Company and
will mature on June 15, 2007. Interest at the annual rate set forth on the
cover page of this Prospectus Supplement will accrue from June 6, 1997 or from
the most recent Interest Payment Date to which interest has been paid or
provided for, payable semiannually on June 15 and December 15 of each year
beginning December 15, 1997 to the persons in whose names the Subordinated
Notes are registered at the close of business on May 31 or November 30, as the
case may be, next preceding such Interest Payment Date. The Subordinated Notes
are not redeemable at the option of the Company prior to maturity and do not
provide for any sinking fund. The Subordinated Notes constitute a single
series and are to be issued under the Subordinated Indenture described in the
accompanying Prospectus.
GLOBAL SECURITIES
The Subordinated Notes initially will be issued as book-entry notes. See
"Description of the Debt Securities--Global Securities" in the accompanying
Prospectus. The Subordinated Notes will be issued in denominations of $1,000
and integral multiples thereof.
Upon issuance, all Subordinated Notes will be represented by Global
Securities. Global Securities representing the Subordinated Notes will be
deposited with, or on behalf of, the Depositary, and registered in the name of
a nominee of the Depositary. Subordinated Notes will not be exchangeable for
certificated notes, provided that if the Depositary is at any time unwilling
or unable to continue as Depositary and a successor Depositary is not
appointed by the Company within 90 days, the Company will issue certificated
notes in exchange for the Global Securities. In addition, the Company at any
time and in its sole discretion may determine not to have book-entry notes
represented by Global Securities, and, in such event, will issue certificated
notes in exchange therefor.
A further description of the Depositary's procedures with respect to Global
Securities representing book-entry notes is set forth in the accompanying
Prospectus under "Description of the Debt Securities--Global Securities." The
Depositary has confirmed to the Company, the Underwriters and the Subordinated
Trustee that it intends to follow such procedures.
SUBORDINATION
As described in the accompanying Prospectus, the Subordinated Notes are
subordinate and subject in right of payment to the prior payment in full of
all existing and future Senior Indebtedness of the Company. See "Subordinated
Debt Securities--Subordination" in the accompanying Prospectus. The
Subordinated Indenture does not limit or prohibit the incurrence of additional
Senior Indebtedness.
As described in the accompanying Prospectus, payment of the principal of the
Subordinated Notes may be accelerated in the case of certain events involving
the bankruptcy, insolvency or reorganization of the Company. There is no right
of acceleration in the case of a default by the Company in the performance of
any covenant or agreement in the Subordinated Notes or the Subordinated
Indenture, including the failure to pay principal of or interest on the
Subordinated Notes when due. See "Subordinated Debt Securities--Limited Rights
of Acceleration" and "--Events of Default" in the accompanying Prospectus.
S-13
<PAGE>
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Subordinated Notes will be made by the Underwriters in
immediately available funds. As long as the Subordinated Notes are represented
by Global Securities, all payments of principal and interest will be made by
the Company in immediately available funds, provided the Depositary makes its
Same-Day Funds Settlement System available to the Company.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing house or next-day funds. In contrast, as long as
the Subordinated Notes are represented by Global Securities registered in the
name of the Depositary or its nominee, the Subordinated Notes will trade in
the Depositary's Same-Day Funds Settlement System, and secondary market
trading activity in the Subordinated Notes will therefore be required by the
Depositary to settle in immediately available funds. No assurance can be given
as to the effect, if any, of settlement in immediately available funds on
trading activity in the Subordinated Notes.
Any certificate for the Subordinated Notes will bear the following legend:
"This Subordinated Note is not a savings or deposit account or other
obligation of a bank and is not insured by the Federal Deposit Insurance
Corporation or any other governmental agency."
BB&T-NC will serve as the paying agent with respect to the Subordinated
Notes.
TRUSTEE
State Street Bank & Trust Company, a Massachusetts trust corporation, will
serve as the Trustee with respect to the Subordinated Notes.
S-14
<PAGE>
UNDERWRITING
Bear, Stearns & Co. Inc., Alex. Brown & Sons Incorporated and Craigie
Incorporated (the "Underwriters") have severally agreed, subject to the terms
and conditions of the Underwriting Agreement, to purchase from the Company the
principal amounts of the Subordinated Notes set forth opposite their
respective names below:
<TABLE>
<CAPTION>
PRINCIPAL
UNDERWRITER AMOUNT
----------- ------------
<S> <C>
Bear, Stearns & Co. Inc........................................ $ 83,400,000
Alex. Brown & Sons Incorporated................................ 83,300,000
Craigie Incorporated........................................... 83,300,000
------------
Total........................................................ $250,000,000
============
</TABLE>
The Underwriting Agreement provides that the obligations of the Underwriters
are subject to certain conditions precedent and that if any of the
Subordinated Notes are purchased by the Underwriters pursuant to the
Underwriting Agreement, all such Subordinated Notes must be so purchased. The
Company has agreed to indemnify the Underwriters against certain liabilities,
including liabilities under the securities laws, or to contribute payments
that the Underwriters may be required to make in respect thereof.
The Company has been advised that the Underwriters propose to offer the
Subordinated Notes to the public initially at the public offering price set
forth on the cover page of this Prospectus Supplement and to certain dealers
at such price less a concession not to exceed 0.40% of the principal amount.
The Underwriters may allow, and such dealers may reallow, a discount to
certain other dealers not to exceed 0.25% of the principal amount. After the
initial offering to the public, the public offering price, the concession to
dealers and the reallowance to other dealers may be changed by the
Underwriters.
The Subordinated Notes will not be listed on any securities exchange. The
Company has been advised by the several Underwriters that the several
Underwriters currently intend to make a market in the Subordinated Notes, as
permitted by applicable laws and regulations. The several Underwriters are not
obligated, however, to make a market in the Subordinated Notes and any such
market-making may be discontinued at any time at the sole discretion of the
several Underwriters. Accordingly, no assurance can be given as to the
liquidity of, or trading markets for, the Subordinated Notes.
Because Craigie Incorporated, an Underwriter in the offering, is expected to
become an affiliate of the Company subsequent to the offering pursuant to an
Agreement and Plan of Reorganization, dated as of March 7, 1997, the offering
of the Subordinated Notes is being made pursuant to Rule 2720 of the National
Association of Securities Dealers, Inc. See "Recent Developments--Pending
Acquisitions and Other Developments" for a description of the proposed
acquisition of Craigie Incorporated by the Company.
The Underwriters and their respective affiliates may be customers of, engage
in transactions with and perform services for the Company and its subsidiaries
in the ordinary course of business.
In order to facilitate the offering of the Subordinated Notes, the
Underwriters may engage in transactions that stabilize, maintain or otherwise
affect the price of the Subordinated Notes during and after the offering.
Specifically, the Underwriters may over-allot or otherwise create a short
position in the Subordinated Notes for their own account by selling more
Subordinated Notes than have been sold to them by the Company. The
Underwriters may elect to cover any such short position by purchasing
Subordinated Notes in the open market. In addition, the Underwriters may
stabilize or maintain the price of the Subordinated Notes by bidding for or
purchasing Subordinated Notes in the open market and may impose penalty bids,
under which selling concessions allowed to syndicate members or other broker-
dealers participating in the offering are reclaimed if
S-15
<PAGE>
Subordinated Notes previously distributed in the offering are repurchased in
connection with stabilization transactions or otherwise. The effect of these
transactions may be to stabilize or maintain the market price of the
Subordinated Notes at a level above that which might otherwise prevail in the
open market. The imposition of a penalty bid may also affect the price of the
Subordinated Notes to the extent that it discourages resales thereof. No
representation is made as to the magnitude or effect of any such stabilization
or other transactions. Such transactions, if commenced, may be discontinued at
any time.
VALIDITY OF SUBORDINATED NOTES
The validity of the Subordinated Notes will be passed upon for the Company
by Womble Carlyle Sandridge & Rice, PLLC, Charlotte, North Carolina, and for
the Underwriters by Gibson, Dunn & Crutcher LLP, New York, New York. Gibson,
Dunn & Crutcher LLP will rely on the opinion of Womble Carlyle Sandridge &
Rice, PLLC, as to matters of North Carolina law, and Womble Carlyle Sandridge
& Rice, PLLC will rely on the opinion of Gibson, Dunn & Crutcher LLP as to
matters of New York law. At the date of this Prospectus Supplement, certain
members of Womble Carlyle Sandridge & Rice, PLLC owned an aggregate of
approximately 22,000 shares of the Company's common stock.
EXPERTS
The consolidated financial statements and schedule included in the Company's
1996 Annual Report on Form 10-K incorporated by reference in the Prospectus as
supplemented by this Prospectus Supplement have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their reports
with respect thereto, and are incorporated by reference herein upon the
authority of said firm as experts in giving said reports.
S-16
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IN
CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. NEITHER THE
DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY SALE MADE
HEREUNDER AND THEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN
OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Incorporation of Certain Documents by Reference............................ S-2
The Company................................................................ S-3
Recent Developments........................................................ S-4
Use of Proceeds............................................................ S-6
Consolidated Ratios of Earnings to Fixed Charges........................... S-6
Selected Consolidated Financial Data....................................... S-7
Pro Forma Condensed Financial Information.................................. S-8
Description of Subordinated Notes.......................................... S-13
Underwriting............................................................... S-15
Validity of Subordinated Notes............................................. S-16
Experts.................................................................... S-16
<CAPTION>
PROSPECTUS
<S> <C>
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
Use of Proceeds............................................................ 4
Consolidated Ratios of Earnings to Fixed Charges........................... 4
Certain Regulatory Considerations.......................................... 4
Description of the Debt Securities......................................... 10
Senior Debt Securities..................................................... 15
Subordinated Debt Securities............................................... 17
Validity of Offered Securities............................................. 19
Experts.................................................................... 19
Plan of Distribution....................................................... 20
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
$250,000,000
BB&T
CORPORATION
7 1/4% SUBORDINATED NOTES
DUE 2007
----------------
PROSPECTUS SUPPLEMENT
----------------
BEAR, STEARNS & CO. INC.
ALEX. BROWN & SONS
INCORPORATED
CRAIGIE INCORPORATED
JUNE 3, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
