Yes, BBT has problems. Some of the posts recently have been overly critical, and in some cases, flat out wrong.
What things does BBT do well? - Customer service is exceptional - Expenses are held exceptionally low, the real source of value for this bank - Underwriting standards were much better than most banks coming into this crisis - Net interest margin is superior to most banks - BBT has exceptional non interest revenues, especially insurance - Dilution of stock was less than most banks exiting TARP - The Colonial acquisition was an exceptional investment - Troubled assets were disposed of in a more orderly manner than most. - BBT did not participate in the most troubled areas (mortgage securitizations, derivatives, etc.)
What does BBT do badly? - Wealth management is weak but improving - Large commercial loans are under represented - There was too high a concentration in ADC coming into the crisis, the source of most loan losses - The management group compensation increases outstrip the value seen by shareholders.
I am willing to be critical, but we should be balanced in our assessments.
Sorry Investorial, but where do you come up with your facts?
1 - Customer Service is Not exceptional, it is average at best. 2 - Banks do not succeed by managing expenses, they succeed by making loans. 3 - UW standards were better coming into the crisis...Who cares? That was three years ago, what have you done for me lately? 4 - NIM is NOT superior, the only reason it may appear better is due to expense controls (see #2 above). 5 - BB&T's fee based income as a % of total has traditionally lagged other major banks, they have been overpaying for insurance brokerage untis. 6 - Dilution was less? Really? You must be of the camp that applies that logic to buy and hold investors who stuck with Wachovia for 20 years and rode it into oblivion. Investors TRADE bank stocks; the dilution argument is weak. If you held stock in financials as the recession kicked in, you desreve to get diluted. 7- Colonial was good? (BB&T's balance sheet has been shrinking ever since.) Then why if BB&T is in this great position have they not done that 20 times over? The fact is King said the bank had trouble valuing these distressed portfolios, but they are supposed to be the EXPERTS...if they cant value the assets then why would you invest in the stock? Troubled Assets disposed of orderly...prove it. 8 - They did not get in trouble with securitizations...being lucky or doing nothing does not equate to genius, and where is the stock price?
One by one, queefo: 1. My source for customer service is independent agencies that measure satisfaction among clients 2. Banks need both loan growth and expense control to be successful. 3. The UW standards directly relate to the level of loan losses. BBT's are lower than most banks. 4. Expense controls do not relate to NIM. And NIM at BBT IS better than most. 5. While the fee based income is not higher than many, it is robust and growing. The insurance business is world class. 6. 50% of BBT's shareholders are long term retail holders of the stock. That is much higher than most. And yes, dilution was less. That is just a fact. 7. Colonial was fabulous. It has not been repeated, and probably never will, because deals this good are rare. 8. They stuck to their knitting when other banks were running around caught up in the frenzy of deal making and derivatives. Lucky or smart, I don't know which. But it was undeniably a plus. The stock price is lower than I would like, but it should do well from here.
Have to disagree Queefo. 1. BB&T has outperformed every bank in customer satisfaction surveys. 2. Your kidding right? 3. Their past good underwriting put them in a strong position when the market crashed, and they continue to exercise tight loan control. 4. Of course 5. Overpaying for insurance units? Show me. 6. Sour grapes? 7. Colonial acquisition was one of the best business deals of the year, per Time Magazine and Fortune Mags writers and others. Sorry you feel so badly about this. I assume you are an ex BB&T employee with a grudge?