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BB&T Corporation Message Board

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  • normlasky normlasky May 4, 2012 9:15 AM Flag

    What Many of You Don't Know:

    Hey Smarty:

    The vast majority of bbt investment securities are mbs government guaratneed. As a result the duration is short - around 3 years. Therefore, as interest rates increase, bbt yield on their investment portfolio will increase. They'll invest the runoff from their mbs portfolio at the market rate. So that blows your argument.

    Your point about the Fed not marking down gov't securities is bizzare. We're not Europe - got our own printing press. Additionally, bbt overwhelming majority of investment securities are backed by home mortgages - 80% or less ltv with the guarantee of gse.

    Last point, is that bbt is well poised for an interest rate increase. Read their 10-k. Their nim will increase appreciably. Look for the section on interest rate sensitivity.

    Go get an education.

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