BB&T Reports Rise in Profit, While SunTrust Posts Decline -- Update

By Allison Prang 

Profit rose at BB&T Corp. but fell at SunTrust Banks Inc. in the first quarter, as both regional lenders recorded merger-related expenses ahead of combining their operations.

BB&T's profit rose 0.5% to $792 million in the quarter that ended in March, compared with the same period a year earlier. Earnings per share were 97 cents, up from 94 cents a share. Analysts polled by Refinitiv were expecting earnings of $1.03 a share.

The company said it had $80 million in merger and restructuring-related charges. BB&T reported adjusted earnings, which excludes those charges, of $1.05 a share. Analysts were expecting $1.03 a share.

At SunTrust, which also released its results Thursday, profit fell 9.8% to $580 million. The bank reported earnings of $1.24 a share, down from $1.29 a share. Analysts were expecting $1.30 a share.

SunTrust said it had $45 million in merger-related costs, or 9 cents a share.

BB&T and SunTrust said just over two months ago that they would merge in a stock deal that was valued at $28.2 billion. Together, they would become the sixth-largest retail bank in the country. A reason for the deal is to be able to scale more with technology.

BB&T is based in Winston-Salem, N.C., while SunTrust is based in Atlanta. The combined company would be based in Charlotte, N.C.

Total taxable-equivalent revenue at BB&T rose 3% to $2.92 billion, slightly less than analysts anticipated. Both net interest income and noninterest income rose.

At SunTrust, fully-taxable equivalent revenue rose 4.2% to $2.35 billion, which beat estimates from analysts. Net interest income rose and noninterest income fell.

SunTrust said that in light of the merger, it isn't expecting to use the $500 million it has left on its share-buyback authorization.

SunTrust also upped its provision for credit losses to $153 million, a jump from the $28 million it set aside a year earlier. The company attributed the increase in part to strong loan growth. Average loans held for investment rose 7.9%.

Average loans held for investment at BB&T grew at a slower pace, rising 3.6%. BB&T is expecting them to increase between 2% and 4% for the fiscal year.

Write to Allison Prang at [e-mail]

(END) Dow Jones Newswires

April 18, 2019 07:37 ET (11:37 GMT)

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