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$BBT said insurance revenues could be higher than projected, if the market responds with better pricing. The company thinks the insurance price increases will be higher because of all the catastrophes and it competes on loan growth and that could cause more positive operating leverage.
$BBT said it continues to invest substantially more in digital strategy. The company's new platform continues to be one of the very best in the business today. $BBT continues to invest in it on a regular basis. $BBT's Zelle P2P program, like all of the other major banks in the country rolled out recently, it's going extraordinarily well.
$BBT expects 1Q18 average total loans of up 1-3% annualized from last quarter and credit quality to be 35-45 basis points. $BBT sees 1Q18 net interest margin to be down 1-3 bps versus 4Q17 and non-interest income of up 1-3% versus 1Q17. For 2018, $BBT sees revenue growth of 2-3%, expenses to be flat from last year and effective tax rate of 21%.
$BBT reported a rise in 4Q17 earnings driven by higher revenue. Net income rose to $614MM or $0.77 per share from $592MM or $0.72 per share last year. Revenue grew to $2.87Bil from $2.73Bil, on an increase in net interest income and higher fees from the majority of non-interest revenues sources. Adjusted EPS for the latest quarter was $0.84.
$BBT announced additional investments in its associates and communities made possible through the tax reform package recently signed into law. The total cost of the program is $152MM, with $15MM related to pay rate increases, $37MM (including fringes) as a one-time bonus and $100MM to $BBT's philanthropic fund.
$BBT's average loans held for investment during 3Q17 were $142.7Bil. Average commercial and industrial loans decreased $295MM. The changes were impacted by the reclassification of approx. $500MM in loans from commercial and industrial to CRE-income producing properties.
$BBT declared dividends of $351.5625 per share on its Series E and Series H Non-Cumulative Perpetual Preferred Stock, and $325 per share on its Series F and Series G Non-Cumulative Perpetual Preferred Stock. All dividends are payable on September 1, 2017 to shareholders of record on August 11, 2017.
$BBT declared a quarterly common stock cash dividend increase of $0.03-0.33 per share payable Sept. 1, 2017, to shareholders of record on Aug. 11, 2017. $BBT also declared a dividend of $365.625 per share on its Series D Non-Cumulative Perpetual Preferred Stock, payable Sept. 1, 2017, to shareholders of record on Aug. 11, 2017.
Financial services provider $BBT has renamed Susquehanna Commercial Finance, a former subsidiary, as BB&T Commercial Equipment Capital. Since the bank acquired Susquehanna Bancshares in 2015, Susquehanna Commercial Finance has operated as a division of Branch Banking and Trust Company. It will continue to do so.
$BBT continues to make investment in Artificial Intelligence (AI) and Robotics, and is engaging with experts specialized in this area to help the firm adapt to that technology. The company believes adaptation of AI and robotics will keep a tight lid on the expenses. It expects Capex in $400-500MM range for 2017 with majority going into technology.
$BBT's net income from Community Banking segment was up 10% to $334MM in 1Q17, while that from Residential Mortgage Banking increased 9% to $48MM. Meanwhile, Treasury and Corporate and Other segments together recorded a loss of $173MM, compared to a profit of $58MM in 1Q16.
$BBT's net income in 1Q17 comprised one-off items including a loss on the early extinguishment of higher-cost FHLB advances of $392MM ($246MM after tax), pre-tax merger-related and restructuring charges of $36MM ($22MM after tax), and $35MM of excess tax benefits from equity-based compensation plans.
Financial services company $BBT reported a dip in 1Q17 earnings due to one-off costs totaling about $233MM. Net income available to common shareholders was down 28% to $378MM, or $0.46 per share. Sans the one-off items, net income was $0.74 per share. Taxable-equivalent revenues were $2.8Bil, an increase of 12%.
$BBT expects core margins to increase 8-10 BP in 1Q17, driven by the federal home loan bank restructuring and favorable asset mix and funding cost and mix changes. GAAP margin is also expected to increase 10-12 BP, while fee income is expected to flat in 1Q17.