You're right. I don't develop retail malls, spec office buildings, and hotels for a living.
But do these loans represent new construction?? Or just refinancing existing(and probably vacant) properties??
MS and GS can certainly leverage their lower capital cost(thanks to the FED) to refi other bank's loans.
Maybe BBT needs to give Kelly King a raise and that would help him get the shareholders a decent return on their investment. Thought all that money he gets was suppose to align him with the shareholders.
This whole deal reminds me of a previous board member who kept saying that the dividend would never be cut. Once BBT cut the dividend that person who was called Still just disappeared. He was much like the postings that Norm (Still) does which is all pro BBT.
Isn't it about time for a new Board Of Directors and new management. I think the share price is now about 65% of the share price over the late 1990's.
In the meantime we have paid out how much to the management and BOD?
Actually not a bad report, but Mr. Market is punishing bank stocks for being bank stocks, and that'll probably continue. In some measure, that'll depend on how some peers do, and more positive reports all around would be helpful. I think the market reaction will be much less about BBT's numbers, and much more about the general disfavor toward this sector.
Banks are cyclical stocks. And the cycle is down because individual and businesses want to minimize their borrowing.
The reluctance to borrow results in lack of growth for the banks and the great American ponzi (aka. stock market)worships growth above everything, including profitability.
Kelly King is too conservative to release significant reserves. Also, BBT has a long history of managing income. King would prefer a steady upward trajectory that a big splash. Management still has a lot of discretion when reporting income. Look for steady but unspectacular improvement.
Yes tomorrow at 6 a.m. will be very interesting. I predict bbt charge-offs drop to $420 million and King bleeds into income 5% of ALL or $130 million. Also, I predict the valuation adjustment will drop to $80 million. A 5% reduction in the ALL is quite modest - unlike key corp's abortion of reporting a $40 million negative provision
The above increases pretax profit by $330 million. Deduct $100 million for last qtr gain.
Bottom line is that King has mucho discretion and I really think he wants to get share price up.