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  • tyrone_jones1st tyrone_jones1st Jun 1, 2011 6:12 PM Flag

    Management

    Norman: I would be amused too if I were not a shareholder. I have stated on this message board that BB&T is a good bank with bad management and I still think that is the case; however, sooner or later the Company will be transformed by current management. I don't think it has happened yet, but it will if changes are not made.

    You are correct that current management is experienced and for the most part career BB&T employees. Something that I have learned over the years is that tenure is not always indicative of competency. Some people do have 20 or 30 years of experience but others have one year of experience 20 or 30 times. I have been a BB&T shareholder for many years and this team is actually quite different than the group that ran BB&T successfully for many years. The long-time CEO (Allison), COO (Williamson), CFO (Reed), Chief Credit Officer (Chalk), have all retired over the past several years and, with the exception of the current CFO (Bible), were all replaced by career BB&T people. While this speaks well for management succession planning, it is also a sign of The Peter Principal which is among the worse things that can befall a company.

    I am aware that Imam Norm has placed me on on ignore and issued a Fatwa to other investors that they should do the same; however, I decided to post this instead of reading through the latest Federal Reserve statistics.

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    • Strong growth in stock price 4th quarter 1990 through 1st quarter 1999.

      NO growth 2nd quarter 1999 until market started crashing around 3rd quarter 2007; price "vibrated" around $40 share.

      KK et al did not take control until well past 3rd quarter 2007, a time when market forces controlled.

      Folks you praise in nostalgic memory were in charge during the ennui of the first 7 years of last decade.

      Were they in charge during the 1990s when things were going gangbusters?

      • 1 Reply to dhrosier
      • The Mgmt team that existed in the 1990s when the share price took off were there for the doldrums of the last decade. The great stock run of the 1990s was not due to superior tactical management of products, services, employees, and customer relatonships. Instead BB&T found a nice niche at the right time and went out and bought bricks and mortar community banks in rural and other tertiary markets when everyone thought internet banking was the future. They got these little banks that nobody else was looking at, at a good price and used the comapny's stock (which got ahead of itself) as currency. At that time BB&T was much smaller, so these little banks did move the needle. And BB&T would clear out the back office, save some pennies, fire some admins, and move on like a big amoeba. That is the factual backdrop of the "nostalgic" look back to the 1990s. That ship ran out of steam over ten years ago. They have NOT introduced any new plays in the play book, unless you consider buying insurance agencies or Colonial as game changers, which they are not. This is now a bank with $130+B in assets. They need to archive the past and figure how to make ROE. Limited organic loan growth is a clear indicator they dont have it right. They are trying to make it work by gathering more deposits (to which they pay nothing) cutting expenses (do more with less qualified, lower paid talent), and charging above average spreads for the same loans offered by other banks. These "strategies" do not a successful bank make. What they do make is a bank that will be stuck in neutral for a long time, if not forever.

 
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