BB&T in Winston-Salem, N.C., reported higher quarterly profit that reflected a significant decrease in expenses and marginal improvement in revenue.

The $220.7 billion-asset company said in a press release Thursday that its first-quarter earnings nearly doubled from a year earlier to $745 million. Its earnings per share of 94 cents beat the mean estimate of analysts compiled by FactSet Research Systems.

BB&T Chairman and Chief Executive Kelly King
Efficiency efforts
"Strong expense control and lower tax expense" played big roles in shaping BB&T's first-quarter results, CEO Kelly King says. Bloomberg News


Noninterest expense fell by 20% to $1.7 billion. The quarter featured a 35% decrease in outside IT services, a 22% decline in merger-related charges and a 13% decrease in the amortization of intangibles. Loan-related expense also fell.

BB&T has cut nearly 1,500 positions in the last year, representing a 4% decline in headcount.

"We had a record quarter with strong expense control and lower tax expense," Kelly King, BB&T’s chairman and CEO, said in the release. The results reflected “continued progress from our optimization efforts," he said.

Net interest income rose by 1.5% to $1.6 billion. Total loans increased by only 0.2% to $144 billion, while deposits fell by nearly 2% to $158 billion. The net interest margin widened by 1 basis point to 3.44%.

BB&T reported a 3% increase in commercial and industrial lending and an 8% rise in commercial real estate. Retail lending fell, including declines in mortgages and indirect lending.

Noninterest income increased by 0.8% to $1.2 billion. Increased revenue from investment banking and bankcard fees offset lower insurance income, service charges on deposits and mortgage banking income.

BB&T also reported that it lost $15 million in revenue and incurred $5 million in noninterest expenses tied to fee waivers and other costs following a high-profile system outage in February.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.