UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
January 14, 1999
BB&T Corporation
(Exact name of registrant as specified in its charter)
Commission file number : 1-10853
North Carolina 56-0939887
(State of incorporation) (I.R.S. Employer Identification No.)
200 West Second Street
Winston-Salem, North Carolina 27101
(Address of principal executive offices) (Zip Code)
(336) 733-2000
(Registrant's telephone number, including area code)
This Form 8-K has 12 pages.
<PAGE>
ITEM 5. OTHER EVENTS
The purpose of this Current Report on Form 8-K is to file BB&T
Corporation's Quarterly Performance Summary for the fourth quarter of 1998,
including sections distributed to the media and a supplement distributed to
analysts.
EXHIBIT INDEX
Exhibit 99.1 Quarterly Performance Summary issued January 13, 1999
<PAGE>
January 13, 1999
FOR IMMEDIATE RELEASE
Contacts:
ANALYSTS MEDIA
Tom A. Nicholson Scott E. Reed Bob Denham
Senior Vice President Senior Executive Vice President Vice President
Investor Relations Chief Financial Officer Public Relations
(336) 733-3058 (336) 733-3088 (336) 733-2202
BB&T reports record earnings for 1998;
Recurring net income increases 19.7%
WINSTON-SALEM, N.C. -- BB&T Corporation (NYSE:BBT) reported today record
1998 earnings totaling $512.8 million, or $1.75 per diluted share, before
after-tax nonrecurring charges of $11.0 million associated with completing
mergers with Life Bancorp, Inc. (Life) of Norfolk, Va. in the first quarter and
Franklin Bancorporation, Inc. (Franklin) of Washington, D.C. in the third
quarter. Excluding nonrecurring charges, net income increased 19.7% and earnings
per share increased 19.0% compared to 1997. BB&T's 1998 results produced a
return on average assets of 1.58% and a return on average equity of 20.16%,
compared to prior year ratios of 1.48% and 18.58%, respectively.
For the fourth quarter of 1998, BB&T's net income totaled $136.5 million,
an increase of 18.8% compared to $114.9 million earned on a recurring basis in
1997. Diluted earnings per share were $.46 for the fourth quarter compared to
$.39 in 1997, an increase of 17.9%.
Including nonrecurring charges, net income for 1998 increased 39.2% to
$501.8 million, or $1.71 per diluted share, compared to $360.4 million, or $1.23
per share, in 1997. For the fourth quarter, net income was $136.5 million, or
$.46 per share, compared to $89.4 million, or $.31 per share, including
nonrecurring charges recorded last year.
BB&T's "cash basis" operating results, which exclude the effect of
intangible assets and the related amortization expense, improved significantly
for the three months and the year ended Dec. 31, 1998, compared to the same
periods in 1997. Cash basis recurring earnings totaled $536.9 million, or $1.83
per diluted share, for the full year 1998, increases of 21.6% and 21.2%,
respectively, over recurring prior year results. For the fourth quarter, cash
basis earnings totaled $144.7 million, or $.49 per diluted share, increases of
21.9% and 19.5%, respectively, over comparable prior year amounts. Cash basis
earnings for 1998 yielded a return on average tangible assets of 1.67% and a
return on average tangible equity of 23.70%.
"It is a pleasure to report record results for 1998," said Chairman and
Chief Executive Officer John A. Allison. "1998 has been an outstanding year for
BB&T. We have been fortunate to achieve all of our strategic objectives.
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MORE
"Our on-going primary objective is to create the `world standard'
revenue-driven sales organization. Through the effective execution of the BB&T
Sales Management System, BB&T has produced the strongest growth rate in
noninterest revenue among the country's 50 largest banks over the last five
years. We achieved noninterest income growth of 28.5% during 1998. Second, we
wanted to differentiate ourselves from our competitors by building upon our
client service strategy. BB&T's recognition by the U.S. Small Business
Administration as America's No. 1 "small business friendly" bank is one result
of the effective implementation of this strategy. Third, we have pursued
excellence in our fundamental financial performance. In 1998, we achieved
essentially all of our financial objectives, placing BB&T in the top 10% of the
nation's bank holding companies in terms of performance.
"Among our other objectives, we wanted to develop more convenient delivery
systems that serve our clients' needs. We increased our ATM network to 770
locations during 1998 and opened a 24-hour customer service call center.
Additionally, we have improved access to BB&T Insurance Services, the largest
independent insurance agency network in the Carolinas and the 16th largest in
the country, by expanding its telephone-based access. Our fifth strategic
objective was to effectively integrate those acquisitions we made during 1997
and to pursue additional strategic acquisitions. We believe we were very
successful in this endeavor."
BB&T expanded and enhanced its franchise in 1998 through a number of
significant mergers and acquisitions. In addition to the mergers of Life and
Franklin, BB&T announced the acquisitions of Maryland Federal Bancorp, Inc., of
Hyattsville, Md. and MainStreet Financial Corporation, of Martinsville, Va. BB&T
also reached agreements to acquire Scott & Stringfellow Financial Inc., an
investment banking firm headquartered in Richmond, Va., W.E. Stanley & Company
Inc., of Greensboro, N.C., an actuarial and employee benefits consulting firm,
and Dealers Credit Inc., of Menomonee Falls, Wis., a national finance company.
BB&T continued to expand its network of insurance agencies through the
acquisitions of W.C. Brown Insurance Services Inc., of Rocky Mount, Va., and
McPhail, Bray, Murphy & Allen Inc., of Charlotte, N.C., completed in 1998. On
Jan. 4, 1999, BB&T acquired Blue Ridge Burke Insurance Agency Inc. of Mount Airy
and Winston-Salem, N.C.
Stockholders have benefited from the financial success of BB&T through a
25.9% increase in the common stock price during 1998. Combined with a 12.9%
increase in the quarterly dividend, the total return to investors in 1998 was
28.5%. Also, BB&T declared a 2-for-1 stock split effective Aug. 3, 1998. The
compound annual total return to shareholders for the 4 years since the
shareholders' vote on the merger of equals between BB&T and Southern National
has exceeded 48%.
BB&T had $34.4 billion in assets and 534 banking offices in the Carolinas,
Virginia, Maryland and Washington, D.C., as of Dec. 31, 1998. BB&T's common
stock is traded on the New York Stock Exchange under the trading symbol BBT. The
closing price of BB&T's common stock on Jan. 12 was $38.38 per share.
For additional information about BB&T's financial performance, products and
services, please visit our Web site at www.BBandT.com.
#
BB&T's news releases are available at no charge through PR Newswire's
Company News On-Call facsimile service. For a menu of BB&T's news releases or to
retrieve a specific release call 800-758-5804, extension 809325.
<PAGE>
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<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 3 Investor Relations FAX (336) 733-3132
For the Three Months Ended Increase (Decrease)
(Dollars in thousands, except per share data) 12/31/98 12/31/97 $ %
INCOME STATEMENT
<S> <C> <C> <C> <C>
Interest income - taxable equivalent $ 659,121 $ 601,230 $ 57,891 9.6 %
Interest expense 315,771 291,880 23,891 8.2
Net interest income - taxable equivalent 343,350 309,350 34,000 11.0
Less: Taxable equivalent adjustment 17,689 15,359 2,330 15.2
Net interest income 325,661 293,991 31,670 10.8
Provision for loan & lease losses 16,000 29,995 (13,995) (46.7)
Net interest income after provision for loan & lease losses 309,661 263,996 45,665 17.3
Noninterest income 139,032 111,282 27,750 24.9
Noninterest expense 249,652 243,197 6,455 2.7
Income before income taxes 199,041 132,081 66,960 50.7
Provision for income taxes 62,548 42,641 19,907 46.7
Net income $ 136,493 $ 89,440 $ 47,053 52.6 %
PER SHARE DATA
Basic earnings $ .47 $ .31 $ .16 51.6 %
Diluted earnings .46 .31 .15 48.4
Weighted average shares - Basic 290,446,160 285,598,814
Diluted 296,732,474 291,097,614
Dividends paid on common shares $ .175 $ .155 $ .02 12.9 %
PERFORMANCE RATIOS
Return on average assets 1.59 % 1.19 %
Return on average equity 19.60 15.27
Net yield on earning assets (taxable equivalent) 4.31 4.37
Efficiency (taxable equivalent) * 51.9 50.6
For the Twelve Months Ended Increase (Decrease)
(Dollars in thousands, except per share data) 12/31/98 12/31/97 $ %
INCOME STATEMENT
Interest income - taxable equivalent $ 2,545,975 $ 2,318,765 $ 227,210 9.8 %
Interest expense 1,233,778 1,106,963 126,815 11.5
Net interest income - taxable equivalent 1,312,197 1,211,802 100,395 8.3
Less: Taxable equivalent adjustment 64,793 53,277 11,516 21.6
Net interest income 1,247,404 1,158,525 88,879 7.7
Provision for loan & lease losses 80,310 98,010 (17,700) (18.1)
Net interest income after provision for loan & lease losses 1,167,094 1,060,515 106,579 10.0
Noninterest income 528,002 457,977 70,025 15.3
Noninterest expense 961,374 968,375 (7,001) (.7)
Income before income taxes 733,722 550,117 183,605 33.4
Provision for income taxes 231,897 189,699 42,198 22.2
Net income $ 501,825 $ 360,418 $ 141,407 39.2 %
PER SHARE DATA
Basic earnings $ 1.75 $ 1.25 $ .50 40.0 %
Diluted earnings 1.71 1.23 .48 39.0
Weighted average shares - Basic 287,427,644 287,480,712
Diluted 293,571,251 292,470,468
Dividends paid on common shares $ .66 $ .58 $ .08 13.8 %
PERFORMANCE RATIOS
Return on average assets 1.55 % 1.25 %
Return on average equity 19.73 15.63
Net yield on earning assets (taxable equivalent) 4.34 4.46
Efficiency (taxable equivalent) * 51.6 51.2
NOTES: Applicable ratios are annualized. All per share data (and weighted average shares) have been restated to reflect the
2-for-1 stock split effective on August 3, 1998.
* Excludes securities gains (losses), foreclosed property expense & nonrecurring items.
</TABLE>
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<TABLE>
<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 4 Investor Relations FAX (336) 733-3132
For the Three Months Ended Increase (Decrease)
(Dollars in thousands, except per share data) 12/31/98 12/31/97 $ %
INCOME STATEMENT EXCLUDING NONRECURRING ITEMS
<S> <C> <C> <C> <C>
Interest income - taxable equivalent $ 659,121 $ 601,486 $ 57,635 9.6 %
Interest expense 315,771 291,880 23,891 8.2
Net interest income - taxable equivalent 343,350 309,606 33,744 10.9
Less: Taxable equivalent adjustment 17,689 15,369 2,320 15.1
Net interest income 325,661 294,237 31,424 10.7
Provision for loan & lease losses 16,000 22,443 (6,443) (28.7)
Net interest income after provision for loan & lease losses 309,661 271,794 37,867 13.9
Noninterest income 139,032 111,921 27,111 24.2
Noninterest expense 249,652 213,256 36,396 17.1
Income before income taxes 199,041 170,459 28,582 16.8
Provision for income taxes 62,548 55,576 6,972 12.5
Net income excluding nonrecurring items 136,493 114,883 21,610 18.8
Nonrecurring items, net of tax - 25,443 (25,443) NM
Net income $ 136,493 $ 89,440 $ 47,053 52.6 %
PER SHARE DATA EXCLUDING NONRECURRING ITEMS
Basic earnings $ .47 $ .40 $ .07 17.5 %
Diluted earnings .46 .39 .07 17.9
Weighted average shares - Basic 290,446,160 285,598,814
Diluted 296,732,474 291,097,614
Dividends paid on common shares $ .175 $ .155 $ .02 12.9 %
PERFORMANCE RATIOS EXCLUDING NONRECURRING ITEMS
Return on average assets 1.59 % 1.52 %
Return on average equity 19.60 19.62
Net yield on earning assets (taxable equivalent) 4.31 4.37
Efficiency (taxable equivalent) * 51.9 50.6
For the Twelve Months Ended Increase (Decrease)
(Dollars in thousands, except per share data) 12/31/98 12/31/97 $ %
INCOME STATEMENT EXCLUDING NONRECURRING ITEMS
Interest income - taxable equivalent $ 2,545,975 $ 2,319,021 $ 226,954 9.8 %
Interest expense 1,233,778 1,106,963 126,815 11.5
Net interest income - taxable equivalent 1,312,197 1,212,058 100,139 8.3
Less: Taxable equivalent adjustment 64,793 53,287 11,506 21.6
Net interest income 1,247,404 1,158,771 88,633 7.6
Provision for loan & lease losses 80,310 90,458 (10,148) (11.2)
Net interest income after provision for loan & lease losses 1,167,094 1,068,313 98,781 9.2
Noninterest income 528,002 410,833 117,169 28.5
Noninterest expense 947,019 832,329 114,690 13.8
Income before income taxes 748,077 646,817 101,260 15.7
Provision for income taxes 235,300 218,278 17,022 7.8
Net income excluding nonrecurring items 512,777 428,539 84,238 19.7
Nonrecurring items, net of tax 10,952 68,121 (57,169) NM
Net income $ 501,825 $ 360,418 $ 141,407 39.2 %
PER SHARE DATA EXCLUDING NONRECURRING ITEMS
Basic earnings $ 1.78 $ 1.49 $ .29 19.5 %
Diluted earnings 1.75 1.47 .28 19.0
Weighted average shares - Basic 287,427,644 287,480,712
Diluted 293,571,251 292,470,468
Dividends paid on common shares $ .66 $ .58 $ .08 13.8 %
PERFORMANCE RATIOS EXCLUDING NONRECURRING ITEMS
Return on average assets 1.58 % 1.48 %
Return on average equity 20.16 18.58
Net yield on earning assets (taxable equivalent) 4.34 4.46
Efficiency (taxable equivalent) * 51.6 51.2
NOTES: Applicable ratios are annualized. All per share data (and weighted average shares) have been restated to reflect the
2-for-1 stock split effective on August 3, 1998.
* Excludes securities gains (losses), foreclosed property expense & nonrecurring items for all periods.
NM - not meaningful.
</TABLE>
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<TABLE>
<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 5 Investor Relations FAX (336) 733-3132
As of / For the Twelve Months Ended Increase (Decrease)
(Dollars in thousands) 12/31/98 12/31/97 $ %
SELECTED BALANCE SHEET DATA
End of period balances
<S> <C> <C> <C> <C>
Securities, at carrying value $ 8,159,266 $ 7,594,263 $ 565,003 7.4 %
Loans & leases 23,694,776 21,233,870 2,460,906 11.6
Allowance for loan & lease losses 314,387 279,596 34,791 12.4
Other earning assets 108,002 302,867 (194,865) (64.3)
Total earning assets 31,860,678 29,049,751 2,810,927 9.7
Total assets 34,427,227 31,290,247 3,136,980 10.0
Noninterest-bearing deposits 3,246,871 2,973,151 273,720 9.2
Interest-bearing deposits 19,799,958 18,402,823 1,397,135 7.6
Total deposits 23,046,829 21,375,974 1,670,855 7.8
Short-term borrowed funds 3,369,101 3,493,199 (124,098) (3.6)
Long-term debt 4,736,934 3,534,203 1,202,731 34.0
Total interest-bearing liabilities 27,905,993 25,430,225 2,475,768 9.7
Total shareholders' equity $ 2,758,548 $ 2,439,110 $ 319,438 13.1 %
Average balances
Securities, at amortized cost $ 7,782,316 $ 7,277,017 $ 505,299 6.9 %
Loans & leases 22,266,058 19,817,354 2,448,704 12.4
Other earning assets 181,018 93,543 87,475 93.5
Total earning assets 30,229,392 27,187,914 3,041,478 11.2
Total assets 32,378,453 28,876,086 3,502,367 12.1
Noninterest-bearing deposits 2,915,369 2,651,885 263,484 9.9
Interest-bearing deposits 18,624,098 17,751,799 872,299 4.9
Total deposits 21,539,467 20,403,684 1,135,783 5.6
Short-term borrowed funds 3,741,501 2,907,657 833,844 28.7
Long-term debt 4,025,428 2,886,686 1,138,742 39.4
Total interest-bearing liabilities 26,391,027 23,546,142 2,844,885 12.1
Total shareholders' equity $ 2,543,400 $ 2,306,603 $ 236,797 10.3 %
NOTES: All items referring to loans & leases include loans held for sale & are net of unearned income.
</TABLE>
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<TABLE>
<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 6 Investor Relations FAX (336) 733-3132
As of / For the Quarter Ended
(Dollars in thousands, except per share data) 12/31/98 9/30/98 6/30/98 3/31/98 12/31/97
INCOME STATEMENTS EXCLUDING
NONRECURRING ITEMS
Interest income - taxable equivalent
<S> <C> <C> <C> <C> <C>
Interest & fees on loans & leases $ 517,328 $ 510,077 $ 497,138 $ 484,365 $ 472,183
Interest & dividends on securities 139,425 127,019 129,900 130,509 127,542
Interest on short-term investments 2,368 2,048 2,801 2,997 1,761
Total interest income - taxable equivalent 659,121 639,144 629,839 617,871 601,486
Interest expense
Interest on deposits 206,344 202,862 201,654 198,216 197,319
Interest on short-term borrowed funds 46,474 46,501 53,217 48,244 44,115
Interest on long-term debt 62,953 59,756 53,698 53,859 50,446
Total interest expense 315,771 309,119 308,569 300,319 291,880
Net interest income - taxable equivalent 343,350 330,025 321,270 317,552 309,606
Less: Taxable equivalent adjustment 17,689 16,174 15,692 15,238 15,369
Net interest income 325,661 313,851 305,578 302,314 294,237
Provision for loan & lease losses 16,000 20,015 21,955 22,340 22,443
Net interest income after provision for
loan & lease losses 309,661 293,836 283,623 279,974 271,794
Noninterest income
Service charges on deposits 44,228 42,854 42,254 41,466 37,844
Mortgage banking activities 18,191 22,485 22,688 15,263 13,381
Trust revenue 11,007 10,034 8,006 7,819 8,097
Agency insurance commissions 13,456 12,346 12,180 14,036 9,664
Other insurance commissions 3,400 2,798 3,210 2,979 3,564
Other nondeposit fees & commissions 29,086 28,723 27,457 24,837 24,729
Securities gains, net 2,040 2,064 1,188 2,460 1,696
Other income 17,624 15,787 13,253 12,783 12,946
Total noninterest income 139,032 137,091 130,236 121,643 111,921
Noninterest expense
Personnel expense 125,950 120,145 118,182 115,051 108,771
Occupancy & equipment expense 36,885 39,518 39,971 37,083 36,115
Foreclosed property expense 357 217 635 828 948
Amortization of intangibles & servicing rights 16,465 11,058 11,027 10,167 7,191
Other noninterest expense 69,995 66,887 64,883 61,715 60,231
Total noninterest expense 249,652 237,825 234,698 224,844 213,256
Income before income taxes 199,041 193,102 179,161 176,773 170,459
Provision for income taxes 62,548 60,965 56,478 55,309 55,576
Net income $ 136,493 $ 132,137 $ 122,683 $ 121,464 $ 114,883
PER SHARE DATA EXCLUDING
NONRECURRING ITEMS
Basic earnings $ .47 $ .46 $ .43 $ .42 $ .40
Diluted earnings .46 .46 .42 .41 .39
Dividends paid .175 .175 .155 .155 .155
Book value $ 9.51 $ 9.42 $ 8.62 $ 8.62 $ 8.46
NOTES: Applicable ratios are annualized. All per share data (and weighted average shares) have been restated to reflect the
2-for-1 stock split effective on August 3, 1998.
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<TABLE>
<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 7 Investor Relations FAX (336) 733-3132
As of / For the Quarter Ended
(Dollars in thousands) 12/31/98 9/30/98 6/30/98 3/31/98 12/31/97
PERFORMANCE RATIOS EXCLUDING
NONRECURRING ITEMS
<S> <C> <C> <C> <C> <C>
Return on average assets 1.59 % 1.64 % 1.53 % 1.57 % 1.52 %
Return on average equity 19.60 21.41 19.97 19.73 19.62
Net yield on earning assets (taxable equivalent) 4.31 4.40 4.29 4.37 4.37
Efficiency (taxable equivalent) * 51.9 51.1 52.0 51.3 50.6
Noninterest income as a percentage of total
income (taxable equivalent) * 28.5 29.0 28.7 27.3 26.3
Equity as a percentage of total assets
end of period 8.0 8.1 7.7 7.7 7.8
Average earning assets as a percentage
of average total assets 92.9 93.5 93.7 93.4 93.8
Average loans & leases as a percentage
of average deposits 103.3 104.5 103.6 102.1 100.5
CASH BASIS PERFORMANCE**
Net income excluding nonrecurring items $ 144,715 $ 137,769 $ 127,931 $ 126,517 $ 118,719
Diluted earnings per share .49 .48 .44 .43 .41
Return on average tangible assets 1.70 % 1.72 % 1.61 % 1.65 % 1.58 %
Return on average tangible equity 24.33 24.87 22.97 22.62 21.77
Efficiency ratio (taxable equivalent) * 50.0 49.8 50.8 50.1 49.6
SELECTED BALANCE SHEET DATA
End of period balances
<S> <C> <C> <C> <C> <C>
Securities, at carrying value $ 8,159,266 $ 8,270,849 $ 7,539,724 $ 7,969,566 $ 7,594,263
Loans & leases 23,694,776 23,138,218 22,288,027 21,839,178 21,233,870
Allowance for loan & lease losses 314,387 313,769 294,226 286,742 279,596
Other earning assets 108,002 241,785 187,795 209,915 302,867
Total earning assets 31,860,678 31,498,647 29,935,288 29,939,448 29,049,751
Total assets 34,427,227 33,875,788 32,159,363 32,148,679 31,290,247
Noninterest-bearing deposits 3,246,871 3,026,236 2,998,966 2,906,193 2,973,151
Interest-bearing deposits 19,799,958 19,071,419 18,582,154 18,322,232 18,402,823
Total deposits 23,046,829 22,097,655 21,581,120 21,228,425 21,375,974
Short-term borrowed funds 3,369,101 4,087,763 3,534,220 4,198,477 3,493,199
Long-term debt 4,736,934 4,386,201 4,081,840 3,740,225 3,534,203
Total interest-bearing liabilities 27,905,993 27,545,383 26,198,214 26,260,934 25,430,225
Total shareholders' equity 2,758,548 2,738,472 2,465,782 2,482,561 2,439,110
Goodwill 382,265 388,294 235,561 215,365 206,997
Core deposit & other intangibles 7,373 6,180 6,502 6,461 6,837
Total intangibles 389,638 394,474 242,063 221,826 213,834
Mortgage servicing rights 101,277 98,433 87,519 72,353 68,780
Negative goodwill $ 26,749 $ 28,310 $ 29,871 $ 31,431 $ 32,992
Average balances
Securities, at amortized cost $ 8,273,621 $ 7,461,704 $ 7,725,496 $ 7,665,281 $ 7,389,149
Loans & leases 23,279,579 22,271,025 22,105,607 21,387,170 20,561,612
Other earning assets 166,033 149,583 201,021 208,245 132,185
Total earning assets 31,719,233 29,882,312 30,032,124 29,260,696 28,082,946
Total assets 34,150,825 31,952,749 32,068,458 31,315,298 29,939,928
Noninterest-bearing deposits 3,120,742 2,933,474 2,868,428 2,734,387 2,754,793
Interest-bearing deposits 19,417,038 18,384,264 18,468,089 18,216,443 17,698,977
Total deposits 22,537,780 21,317,738 21,336,517 20,950,830 20,453,770
Short-term borrowed funds 3,766,831 3,488,026 4,029,351 3,683,668 3,313,540
Long-term debt 4,521,380 4,167,594 3,700,977 3,701,186 3,358,158
Total interest-bearing liabilities 27,705,249 26,039,884 26,198,417 25,601,297 24,370,675
Total shareholders' equity $ 2,762,782 $ 2,448,113 $ 2,463,748 $ 2,497,084 $ 2,323,200
RISK-BASED CAPITAL***
Risk-based capital:
Tier 1 $ 2,302,400 $ 2,242,803 $ 2,166,004 $ 2,209,375 $ 2,153,212
Total 3,409,160 3,344,818 3,291,604 2,968,844 2,909,563
Risk-based capital ratios:
Tier 1 10.0 % 10.0 % 10.2 % 10.5 % 10.3 %
Total 14.7 14.9 15.5 14.0 13.9
Leverage capital ratio 6.8 7.1 6.8 7.1 7.3
NOTES: All items referring to loans & leases include loans held for sale & are net of unearned income.
Applicable ratios are annualized. All per share data (and weighted average shares) have been restated to reflect the
2-for-1 stock split effective on August 3, 1998.
* Excludes securities gains (losses), foreclosed property expense & nonrecurring items for all periods.
** Cash basis operating results exclude the effect on earnings of amortization expense applicable to intangible
assets that do not qualify as regulatory capital. Cash basis performance ratios exclude the effect of amortization
of nonqualifying intangible assets from earnings and the unamortized balances of nonqualifying intangibles from assets
and equity.
*** Current quarter estimated.
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<TABLE>
<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 8 Investor Relations FA(336) 733-3132
As of / For the Quarter Ended
(Dollars in thousands, except per share data) 12/31/98 9/30/98 6/30/98 3/31/98 12/31/97
ASSET QUALITY ANALYSIS
Allowance For Loan & Lease Losses
<S> <C> <C> <C> <C> <C>
Beginning balance $ 313,769 $ 294,226 $ 286,742 $ 279,596 $ 270,068
Allowance for acquired loans - 15,542 1,269 - 12,012
Provision for loan & lease losses 16,000 20,015 21,955 22,340 29,995
Charge-offs (20,381) (21,220) (20,782) (20,681) (36,183)
Recoveries 4,999 5,206 5,042 5,487 3,704
Ending balance $ 314,387 $ 313,769 $ 294,226 $ 286,742 $ 279,596
Nonperforming Assets
Nonaccrual loans & leases $ 84,968 $ 83,623 $ 78,919 $ 92,971 $ 99,938
Foreclosed real estate 16,730 20,570 19,476 15,477 20,937
Other foreclosed property 11,222 11,322 13,911 14,603 13,986
Restructured loans 522 525 528 - 1,377
Nonperforming assets $ 113,442 $ 116,040 $ 112,834 $ 123,051 $ 136,238
Loans 90 days or more past due
& still accruing $ 49,833 $ 46,873 $ 48,947 $ 42,257 $ 44,362
Asset Quality Ratios
Nonaccrual loans & leases as a
percentage of total loans & leases .36 % .36 % .35 % .43 % .47 %
Nonperforming assets as a percentage of:
Total assets .33 .34 .35 .38 .44
Loans & leases plus
foreclosed property .48 .50 .51 .56 .64
Net charge-offs as a percentage of
average loans & leases .26 .29 .29 .29 .63
Allowance for loan & lease losses as
a percentage of loans & leases 1.33 1.36 1.32 1.31 1.32
Ratio of allowance for loan & lease losses to:
Net charge-offs 5.15 x 4.94 x 4.66 x 4.65 x 2.17 x
Nonaccrual and restructured loans & leases 3.68 3.73 3.70 3.08 2.76
MEMO ITEMS
Unrealized appreciation on securities
available for sale, net of tax $ 61,585 $ 92,472 $ 49,739 $ 48,122 $ 49,368
Common stock prices (daily close): High 40.63 36.03 34.06 33.84 32.50
Low 27.31 28.00 32.03 29.03 25.97
End of period $ 40.31 $ 29.94 $ 33.81 $ 33.84 $ 32.03
Weighted average shares - Basic 290,446,160 284,261,612 286,202,810 288,816,880 285,598,814
Diluted 296,732,474 289,997,773 292,403,822 295,173,066 291,097,614
End of period shares outstanding* 290,210,766 290,805,799 142,974,787 144,061,025 144,084,236
End of period banking offices 534 540 524 527 532
As of / For the Twelve Months Ended Increase / (Decrease)
(Dollars in thousands) 12/31/98 12/31/97 $ %
Allowance For Loan & Lease Losses
<S> <C> <C> <C> <C>
Beginning balance $ 279,596 $ 243,568 $ 36,028 14.8 %
Allowance for acquired loans 16,811 17,513 (702) (4.0)
Provision for loan & lease losses 80,310 98,010 (17,700) (18.1)
Charge-offs (83,064) (97,829) (14,765) (15.1)
Recoveries 20,734 18,334 2,400 13.1
Ending balance $ 314,387 $ 279,596 $ 34,791 12.4 %
Asset Quality Ratios
Net charge-offs as a percentage of
average loans & leases .28 % .40 %
Ratio of allowance for loan & lease losses to
net charge-offs 5.04 x 3.52 x
NOTES: All items referring to loans & leases include loans held for sale & are net of unearned income.
Applicable ratios are annualized. All per share data (and weighted average shares) have been restated to reflect the
2-for-1 stock split effective on August 3, 1998.
*End of period shares reflect the 2-for-1 stock split following the August 3, 1998, effective date. Shares reflected prior
to the effective date are stated as originally reported.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
QUARTERLY PERFORMANCE SUMMARY Tom A. Nicholson
BB&T Corporation (NYSE:BBT) Senior Vice President (336) 733-3058
Page 9 Investor Relations FA(336) 733-3132
For the Quarter Ended
12/31/98 9/30/98 6/30/98 3/31/98 12/31/97
INTEREST YIELDS/RATES (Taxable equivalent)
Interest income:
<S> <C> <C> <C> <C> <C>
Securities* 6.73 % 6.80 % 6.73 % 6.83 % 6.90 %
Loans & leases 8.83 9.10 9.01 9.16 9.12
Other earning assets 5.66 5.43 5.59 5.84 5.29
Total earning assets* 8.27 8.51 8.40 8.52 8.52
Interest expense:
Interest-bearing deposits 4.22 4.38 4.38 4.41 4.42
Short-term borrowed funds 4.89 5.29 5.30 5.31 5.28
Long-term debt 5.55 5.71 5.81 5.87 5.98
Total interest-bearing liabilities 4.53 4.71 4.72 4.75 4.75
Net yield on earning assets 4.31 % 4.40 % 4.29 % 4.37 % 4.37 %
NOTE: *Yields calculated based on securities at amortized cost.
As of
(Dollars in thousands) 12/31/98
DERIVATIVES: INTEREST RATE SWAPS, CAPS, FLOORS & COLLARS
Notional Receive Pay Unrealized
Type Amount Rate Rate Gains (Losses)
<S> <C> <C> <C> <C>
Receive fixed swaps $ 1,266,200 6.24 % 5.30 % $ 43,369
Pay fixed swaps 1,180,146 5.34 5.67 (5,503)
Basis swaps 50,000 4.95 5.34 (31)
Caps, floors & collars 1,247,250 - - 623
Total $ 3,743,596 5.79 % 5.48 % $ 38,458
One Year One to After
Contractual Maturity Schedule Total or Less Five Years Five Years
<S> <C> <C> <C> <C>
Receive fixed swaps $ 1,266,200 $ 561,200 $ 445,000 $ 260,000
Pay fixed swaps 1,180,146 1,010,200 105,869 64,077
Basis swaps 50,000 50,000 - -
Caps, floors & collars 1,247,250 500,000 747,250 -
Total $ 3,743,596 $ 2,121,400 $ 1,298,119 $ 324,077
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S I G N A T U R E
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BB&T CORPORATION
(Registrant)
By: /S/ SHERRY A. KELLETT
Sherry A. Kellett
Senior Executive Vice President and Controller
(Principal Accounting Officer)
Date: January 14, 1999
