"why do all the peer banks go up and bbt goes down? I will never get that. I think its all a sham to keep stock at bbt low, STI, WFC, FITB, BAC, RF, all up today"
You bring up a good point. Imo, at $26.44 per share, bbt has much more valued than wfc, usb and pnc. Not even close.
Since 2009, the bank has incurred gigantic markdowns via the valuation adjustment in non-interest expense because the marks taken on their bad loans were inadequate. So now folks like credit suisse think it will be another 2 years before bbt loan losses will normalize at 50 bsp per year. As a result, share price is very depressed.
Why were they inadequate?
If you made a land loan with at 65% ltv, you would think that you would not be vulnerable to big loss severities. But as we went through this recession, it became clear that land markets were almost non-existent with average prices bringing maybe 20 to 30% of the original appraised value.
The gigantic markdowns are about to end. We're almost at the bottom of the barrel on bad land loans. About 60% of the last qtr chargeoffs were land related and we're going to see substantial reductions in 2011.
I think Kelly King should continue to clean house in the 4th qtr and set the stage for drastically improved financial results in 2011.
I have a lot of confidence in this bank and believe King has done a good job.
I think King needs to straighten out some of these folks like credit suisse who have kept the banks current ALL fixed at $2.3 billion through 2013 even though they drop charge-offs to 50 bsp in their 2013 projected statement of income.
Believe that norm is the most knowledgeable on the board. For my part I believe that BB&T profit improvement will come later than I expected . After Kelly King's report at the end of the 3rd quarter, I expected a small dividend increase. Didn't happen. I watch a couple of commercial properties financed by BB&T which have been on the market for a long time. I believe that BB&T management has misjudged the real estate market in the past. They might have it wrong now. I believe that BB&T shares are fairly valued until real estate starts to sell (at whatever price). I would buy more shares below $22. Will not sell my shares