Thanks norm. Missed the conference call. How much in bad loans did BB&T actually write off in the third quarter? Also, do you have a best case worst case profit estimate for 2012 using present fed funds rate and Kelly King's write off estimate? Thanks again.
Make sure you dont forget to factor in the following: QIII total loans were $103.8B, compared to QIII 2010 which was 102.3B, or a 1.5% growth rate. Even though this growth number is terrible, it is not the real story. BB&T chose to hold more of its residential loan production in inventory, rather than sell it, which is why in QIII they are showing an 18% improvement in residential mortgages. If these loans were treated on an apples to apples comparison, that portion of the protfolio would have grown less, if at all.
This is just another example of skillful manipulation.
The fact is that the magic $3.0B in "new" residiential mortgages is a phantom number...without it, their total loan portfolio would have been 100.8B, compared to last year's 102.3B, meaning their blance sheet is in fact shrinking on an apples to apples view.
And finally, one neat piece of information is that mortgage applications are up 87%, but what Management is not clearly articulating is how many of these applications, whether they are for mortages, C&I, or other types of loan, are being turned down by credit. And as we can see above, very few loans are being made, so again, besides LLR manipulation, income here is directly related to churning their cash...not much of a lender. I wonder why they keep so many loan oficers employed when they are not making loans?
Litmus test in 2012 will be to see how much of the securities portfolio is unwound and the capital is deployed for new lending. No reason to invest here until that inflexion point cometh.