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  • queefoo queefoo Dec 12, 2012 11:00 AM Flag

    My Apologies to Everyone!

    Your sentiments are correct, but your facts are a little off. Contrary to all its glossy advertising and strategic mission statements, BB&T is just another bank looking to make a spread. And not a very well run bank at that. They want your business up until the moment they dont want it...then it is lights out. Part of the problem here is their Credit Dept has a choke hold on the entire organization...and their credit culture is weak. For years they have trumpeted their great ability to underwrite credit and then we all found out they did not know anything about credit (unlike the rest of the banking univese, they refused to mark their NPAs correctly and take the pain at the outset, because they could not POSSIBLY admit they dont know how to lend money, and now, even years later, shareholders have to deal with death by a thousand cuts). This has ceased to be a bank built on client relationships the way it was 15+ years ago. Now you are no longer a customer of the bank and are no longer treated as such, you are just a borrower. Therre is a big difference.

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    • " they refused to mark their NPAs correctly and take the pain at the outset"

      Their big problem was in their adc portfolio which topped out at $9 billion. Absolutely no one could have projected that the bulk of the $9 billion of adc loans ended up with loss severity rates around 80% or possibly even higher. Heck, the smart thing would have been to take 100% write-off on the adc land and hold it until markets recovered instead of selling the bad loans to speculators. As a side note I guess the personal guarantees on 85% of the adc loans which their investor relations department mentioned to me in several phone calls proved to be essentially worthless.

      My problem with Kelly King is that he failed to provide proper disclosure of the charges run through the valuation allowance - $2 billion plus over the last several years is a huge amount of $$$ and "bragged" about bbt net charge-offs vs. competition. Note that this slide has been removed from their deck because even the bank knew it was outrageous.

      Got other problems with bbt. They certainly need to learn how to write an EPS headline as evidenced by the recent stock shellacking after the 3rd qtr. cc. Don't blame it on 375 margin particularly when the bank has been touting about this for many quarters.

      The quality of their loans has improved dramatically, yet they're still providing well above their normalized provision expense - say 70 bsp per year? Where's the 15% return on Crump insurance - $560 million investment should generate $100 million of net cash flow annually? Show me the quarterly flow of colonial gross interest income and fdic reimbursement - why does it vary so much quarterly? How much reo stuff does bbt have on the books which the bank will hold until markets improve? And for heaven sake, when is the valuation allowance going to stop? Why does the bank have a discount brokerage business which is not cost competitive - costing bbt a tremendous amount of revenue.

      I look at bbt presentations. They talk about core values. They claim that they have been "super transparent" - believe that is the direct quote King used at the Goldman Sachs recent conference. I disagree. Lot of useful info but think they're presentations are too opaque in many key areas. Suggest they provide investors with straight talk.

      • 1 Reply to normlasky
      • Norm, I must say I finally like one of your posts. This bank has regressed a long way from when Allison ran it back in the 1990s. They had a simple yet reasonable business model then. Trouble is, they thought they could retain those same community bank characteristics and also have $100B+ in assets, and a host of ancillary fee-based businesses. They also felt they could run such a beast with the same type of managers. Didn't work. What they failed to realize was this: when you get that big and pursue these different businesses, you need a different sort of VP/SVP level person running the store. They never figured that out. They thought the same old mediocre talent that used to make car loans could match wits with Wall Street financiers, manage insurance agencies, capital markets platforms, large unsecured credits, and the ALCO statement. For BB&T to succeed they simply need to sell, or split up and go back to their community roots, or gut their staff and bring in some much needed talent that can think (and did not go thru the BB&T Mgmt training program, which is where the bad habits start).

    • Yeah queefoo your right. Their credit dept especially credit card dept sucks. This dept is what gave me my big shafting. And to proof any wrongdoing better be done within 5 years because after that they purge their books or data bases. BBT is constantly moving or firing their managers of their branches, doing the same to their tellers. And I had a teller that had left the bank and went to 5th third tell me that the reason she left is because she didn't like the way BBT was treating their customers. And being that I'm a long time customer or borrower in your words I tried to refinance my home loan and to get a good rate I had to pay extra money to get the rate. I told them to stick it, I'd keep what I had. What also made me mad was the fact that they gave that sorry CEO a 10 million dollar bonus and 1 mill a year salary. It is simply amazing how they have skirted under the radar during all this crisis trouble. On their credit loans especially home loans they are thru Freddie Mac. I know mine is. So I do not reconmend anyone getting tied up with this bank. As soon as I can I'm leaving this bank.

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