BB&T (BBT) Q4 Earnings Beat On Higher Revenues, Costs Rise

BB&T Corporation’s (BBT - Free Report) fourth-quarter 2017 adjusted earnings of 84 cents per share outpaced the Zacks Consensus Estimate of 80 cents. The bottom line recorded 7.7% improvement from the year-ago quarter.

Results reflected a rise in revenues driven by higher rates and loan growth. However, an increase in operating expenses and higher credit costs were the undermining factors.

Results excluded merger-related and restructuring charges and adjustments related to the tax reform. After considering these, net income available to common shareholders was $614 million or 77 cents per share compared with $592 million or 74 cents per share in the prior-year quarter.

For 2017, adjusted earnings of $3.14 per share beat the Zacks Consensus Estimate of $2.77. Also, the figure was up 9.4% year over year. After considering non-recurring items, net income available to common shareholders was $2.2 billion or $2.74 per share compared with $2.2 billion or $2.77 per share in 2016.

Revenues Improve on Modest Loans & Deposits Growth

Total revenues (taxable-equivalent) for the quarter came in at $2.91 billion, up 5% year over year. The figure also outpaced the Zacks Consensus Estimate of $2.84 billion.

For 2017, total revenues (taxable equivalent basis) were up 4.8% from the prior year to $11.5 billion. The figure was marginally above the Zacks Consensus Estimate of $11.4 billion.

Tax-equivalent net interest income rose 4.7% from the prior-year quarter to $1.68 billion. Also, net interest margin expanded 11 basis points (bps) from the prior-year quarter to 3.43%.

Non-interest income increased 5.4% year over year to $1.23 billion. Rise in all fee income components except insurance income and mortgage banking fees, drove the increase.

Non-interest expenses of $1.86 billion increased 11.2% from the year-ago quarter. The increase was primarily due to a rise in personnel expenses, net merger-related and restructuring charges and professional service costs.

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