2018 Annual Report

To our shareholders: In 2018, BB&T achieved strong results, including the best stock performance in our peer group, by adhering to our long-held values, while simultaneously making fundamental changes in the way we deliver products and services.


Our Vision Our Vision is part of the 2 // OUR CULTURE section

To create the best financial institution possible – “The Best of the Best.”

Our Mission

To make the world a better place to live, by:

  • Helping our clients achieve economic success and financial security;
  • Creating a place where our associates can learn, grow and be fulfilled in their work;
  • Making the communities in which we work better places to be; and thereby:
  • Optimizing the long-term return to our shareholders, while providing a safe and sound investment.

Our Values

Pyramid showing the values of BB&T. Happiness, success, judgment and character


The Premier Financial Institution The Premier Financial Institution is part of the 3 // MERGER OF EQUALS section

Our merger of equals with SunTrust will create the nation’s premier financial institution.

Infinity loop graphic shows similarities between BB&T and SunTrust through stated values, principles and mission statements. BB&T mission to Make the World a Better Place to Live. SunTrust mission: Lighting the Way to Financial Well-Being.

This powerful combination will be the sixth-largest U.S. commercial bank, serving more than 10 million clients in many of the nation’s fastest-growing markets.

Both companies have strong purpose-driven cultures. Our diverse and comprehensive mix of businesses will have leading market shares in traditional banking, insurance brokerage and capital markets. Our risk management will be as rigorous as ever. Our capital and liquidity positions will be strong.

More than a combination of two strong companies with a combined 275 years of proud history, the BB&T merger of equals with SunTrust will build a new and different bank – a true transformation. The substantial cost savings and opportunities for growth will fuel our investment in the technology and innovation that clients expect and demand.

Ours is a true merger of equals. We will build on the best of both institutions’ talent, technology and processes. The new executive management team and board will be evenly divided between leaders from the two legacy banks. A new name will be chosen later this year. We will locate our corporate headquarters and a new innovation and technology center in Charlotte, North Carolina, while still supporting our hometowns of Winston-Salem, North Carolina, and Atlanta, Georgia, with significant operations and increased investment.

We share similar missions that will guide us as we embrace — and lead — this new banking world. By lighting the way to financial well-being – SunTrust’s underlying purpose – we also achieve BB&T’s long-standing mission of making the world a better place to live.

Illustrated map showing BB&T and SunTrust's combined market position across a diverse set of businesses. States represented include Pennsylvania, New Jersey, Delaware, Kentucky, West Virginia, Ohio, Virginia, Maryland, Washington D.C., North Carolina, South Carolina, Tennessee, Georgia, Alabama, Mississippi, Florida and Texas.


Character at Work Character at Work is part of the 5 // ENGAGED ASSOCIATES section

Our associates are learning and growing as they serve clients and the community.


Helping Neighbors in Need Helping Neighbors in Need is part of the 6 // GROWING COMMUNITIES section

BB&T associates are committed to helping communities overcome adversity and thrive.


2018 marked the 10th anniversary of our BB&T Lighthouse Project, a community service effort that empowers associates to make a difference.

Since 2009, BB&T associates have completed more than 11,000 community service projects, volunteered more than 640,000 hours and improved the quality of life of more than 16.5 million people.

BB&T is merely a reflection of our communities. When communities succeed, we succeed.

— Kelly S. King, Chairman and CEO

Illustrated map showing locations whereMap highlights some locations where BB&T Lighthouse projects have been completed in the following states Missouri, Kansas, North Carolina, West Virginia and Maryland
  • Map pin icon with the number 1. Opens article titled, The Healing Power of Play

    The Healing Power of Play

  • Map pin icon with the number 2. Opens article titled, Feeding Community

    Feeding Community

  • Associates in Durham, North Carolina, partnered with Urban Ministries to prepare and serve food to more than 350 people.
  • A Clarksburg, West Virginia, Community Banking team updated a 2,500-square-foot playroom in the Alta Vista Children’s Shelter, which teaches children as young as 6 life skills and behavior management.
  • A Commercial Credit team in Columbia, Maryland, updated an emergency shelter, HopeWorks, which offers a haven to victims of domestic and sexual violence, including human trafficking.
  • Associates headed to Panama City, Florida, to provide bottled water to residents after Hurricane Michael caused a county water system to fail.


Since 2010, BB&T’s financial education program has empowered more than 300,000 students to navigate modern financial life.

Pre- vs. Post-Assessment Scores
On average, student assessment
scores nearly double.


Bar graph showing assessment scores. 47 percent pre-test. 85 percent post-test

Financing Higher Education
Eighty-five percent increase in students who
understand how to apply for
financial aid to help pay
for college.

Maintaining a Good Credit Score
The number of students who
understand how to maintain
a positive credit score
nearly doubled.

7 // Empowering Leaders

Inside the BB&T Leadership Institute Inside the BB&T Leadership Institute is part of the 7 // Empowering Leaders section

Providing business, educational and student leaders with the skills they need to succeed.

In terms of architectural aesthetics, the company’s greatest accomplishment during the past year is arguably The BB&T Leadership Institute’s state-of-the-art, 58,000-square-foot campus that opened in June in Greensboro, North Carolina. It exemplifies how the integration of nature, design, sustainability and purpose can inspire innovation and learning.

The Leadership Institute’s training campus is situated on an 11-acre wooded property, and the LEED Silver-certified main building’s glass walls provide guests with unobstructed views of the surrounding lake and woods. The campus features multiple buildings, including a spacious treehouse for corporate meetings. Guests can travel between buildings through interconnecting wooden walkways that appear as bridges floating above the lake.

Led by Director William W. Sutton, The Leadership Institute furthers BB&T’s mission to positively impact businesses and communities by empowering corporate, educational and student leaders. The Leadership Institute provides unique, psychology-based programs about leadership development, talent management, team optimization and more, helping leaders to learn, grow and be fulfilled in their work.

Participants say one of the marvels of The Leadership Institute is how its programs enable them to grow professionally and personally.

Grounded in psychology and informed by modern science and research, The Leadership Institute’s programs are designed to enable “ordinary” people to achieve extraordinary results. The Leadership Institute’s tag line, “The Psychology of Better Business,” conveys its essence: leveraging the science of the mind to help women and men run better companies, organizations and schools.

BB&T gives back to communities in North Carolina and a growing number of states by providing tuition-free leadership programs to college and university students and to pre-K through 12th-grade public school educators. To date, more than 3,300 student leaders and nearly 700 educational leaders have completed programs free of charge.

Learn more at BBTleadershipInstitute.com

The BB&T Leadership Institute, lit up at night
Inside of the treehouse at the BB&T Leadership Institute. Rectangular meeting table surrounded by glass walls
The inside of a bedroom at the BB&T Leadership Institute
There is no facet of society that cannot be improved through better leadership.

— Kelly S. King, Chairman and CEO

8 // By the numbers

2018 Performance 2018 Performance is part of the 8 // By the numbers section

BB&T reported record annual earnings in 2018, with strong momentum and balanced growth that position us for another very good year in 2019. Our results were driven by record insurance and investment banking income, diversified loan growth, stellar credit quality and strong expense management. These results reflect our laser focus on producing excellent returns for our shareholders while at the same time investing in digital and other initiatives that are crucial to excel in a new banking world.

Taxable equivalent revenue increased 1.6 percent during 2018 to $11.7 billion. Net income available to common shareholders was a record $3.1 billion, or $3.91 per diluted share, up 38 percent from $2.2 billion, or $2.74 per diluted share, in 2017.

BB&T vs Peers

Note: Market data through 2/6/19. Peer median includes: BAC, CFG, COF, FITB, HBAN, KEY, MTB, PNC, RF, STI, USB, WFC. Source: S&P Global

Strong Loan Growth

Average loans held for investment increased a strong 3.6 percent annualized in the fourth quarter.

Commercial and industrial (C&I) loans drove our growth, with strong performance in corporate banking, dealer floor plans, equipment and indirect lending led by auto and recreational lending. The growth in C&I loans reflects our long-term strategy of reducing the proportion of more volatile commercial real estate loans. For 2019, we expect loan growth in the 2 percent to 4 percent range, based on our belief that the economy will continue to expand despite economic uncertainty.

BB&T’s community bank, which contributes more than half of BB&T’s revenue, reported gains in retail and commercial loans even as we closed 170 branches, or 8.3 percent of our 15-state branching network. We retained virtually all of the clients of closed branches, in part by introducing them to our digital banking services. More than 3 million clients now use BB&T’s U digital platform.

Our community bank benefited from Main Street companies returning to traditional banking markets from highly leveraged capital markets. We stepped up our calls on smaller businesses, with 10,000 more calls per week, while identifying 14 target industries, starting with veterinary, dental and medical practices and adding three more industries each quarter during the year.

Record Insurance Income

Income from BB&T’s national insurance brokerage business, buoyed by new business in an expanding economy and more favorable industry conditions, increased by 16.5 percent over the fourth quarter of 2017. Insurance, our largest nonbanking business, accounting for 17 percent of BB&T’s revenue, provides important diversification and stability because it is not subject to fluctuating interest rates or the dynamics of the credit markets. Our investment banking and brokerage operations, also national in scope, reported a 25.2 percent gain in noninterest income compared to the fourth quarter of 2017. Scott & Stringfellow, BB&T’s full-service brokerage, has expanded into all of our primary operating states to support our growing wealth business. We also benefited from strong performances by BB&T’s diversified specialty lending businesses, including Grandbridge Real Estate Capital, our national commercial real estate and multifamily business, and Sheffield Financial, which provides consumer financing for outdoor power and power sports equipment.

The combination with SunTrust will fuel further growth for BB&T’s insurance and specialized lending businesses and our combined investment banking capability as we offer those services to an expanded client base.

Noninterest-bearing deposits dipped by 3.2 percent on an annualized basis in the fourth quarter as companies invested more in their operations. But we continue to benefit from our long-term strategy of improving the mix of our deposits and from the loyalty of our clients. We have become one of the leaders among our peers in noninterest-bearing deposits as a percentage of total deposits. On average, BB&T’s clients have had their retail accounts with us for 10 years and their commercial accounts for eight years.

2018 BB&T revenue diversification by segment. Insurance Holdings and Premium Finance, 17%. Community Banking, Retail Consumer Finance, 43%. Community Banking, Commercial, 23%. Financial Services and Commercial Finance, 17%

Stellar Credit Quality

Nonperforming assets are at historically low levels, at 0.26 percent of total assets at the end of 2018.

Net charge-offs as a percentage of average loans and leases compare favorably with our peers, at 0.38 percent for the fourth quarter of 2018. We remain intensely focused on diversification and our conservative lending limits. We do not take big project risks or large exposures. The average loan size in our C&I portfolio is less than $1 million. In a rapidly changing industry, we constantly enhance our risk controls. Most importantly, BB&T’s best risk control is our strong culture and our associates’ commitment to ethics and honesty.

BB&T’s allowance for loan loss coverage ratios also remain strong at 2.99 times for nonperforming loans and 2.76 times for net charge-offs. A higher ratio means a bank can withstand any future losses better.

The balance between BB&T’s net interest income and our noninterest income provides further diversification. Our fee income ratio of 42.2 percent for the year compares favorably to the 34.7 percent average of our peers. A higher value indicates a bank is producing more of its revenue from noninterest income.

Our net interest margin, a key measure of profitability, improved throughout 2018 – at 3.49 percent in the fourth quarter compared to 3.43 percent in the fourth quarter of 2017 – and was superior to the 3.24 percent median of our peers. The margin is the difference between interest received on loans and investments and interest paid on deposits and other funding, expressed as a percentage of earning assets.

Superior Performance
PPNR/average assets
10-year average
(1Q09 – 4Q18)

…with Less Volatility
PPNR/average assets
10-year standard deviation
(1Q09 – 4Q18)

National peer group: BAC, CFG, COF, FITB, HBAN, KEY, MTB, PNC, RF, STI, USB and WFC. Largest 4 BHCs: BAC, C, JPM, WFC

Excellent Cost Control

We recognize reducing costs and increasing efficiency are more vital than ever, as we invest more in technology and automation. Our adjusted noninterest expense, which excludes merger-related and restructuring charges, was down 3.7 percent annualized in the fourth quarter of 2018, compared to the third quarter of 2018. Our adjusted efficiency ratio was 56.5 percent for the fourth quarter of 2018, the lowest level since 2014. The ratio measures expenses as a percentage of revenue, so lower percentages signal better performance.

Other key ratios underscore BB&T’s commitment to deliver top-tier profitability, with prudent capital management and leading returns to shareholders. Both our adjusted return on average assets and adjusted return on average tangible common shareholders’ equity compared favorably with our peers.

As we leverage the estimated $1.6 billion of pretax cost savings net of investments and other benefits of the SunTrust merger of equals, we believe our efficiency and return on average common equity ratios will lead all of our peers.

Our capital and liquidity levels remain strong and our 41.1 percent dividend payout ratio in the fourth quarter of 2018 was superior among our peers. BB&T’s priorities for using our capital are clear: organic growth is first, a strong dividend payout is second, followed by share buybacks and strategic opportunities.

BB&T has a long history of consistent and superior performance. We grow the company within our conservative risk parameters, driven by strong, diversified market share across lines of business and markets, to produce shareholder returns in all economic cycles. With enhanced scale, revenue opportunities and investments in technology made possible by the SunTrust merger of equals, we will create a sustainable competitive advantage in an increasingly digital world.

Record Taxable Equivalent Revenues
($11.7 billion)

Record Net Income Available to Common Shareholders ($3.1 billion)

Record Diluted Earnings Per Share

10 // New Beginning

Thank You Thank You is part of the 10 // New Beginning section

I have said many times, the three primary criteria for a combination are: It must be a good fit culturally, make sense strategically and be compelling economically. And as I have stressed more recently, in today’s rapidly changing environment, BB&T must disrupt itself to continue to thrive.

Our merger of equals with SunTrust will accomplish all of those objectives. I am also excited about the combination because it further deepens our leadership. Our new executive management team will be comprised of seven leaders from BB&T and seven from SunTrust. William H. Rogers Jr. will serve as president and chief operating officer until September 2021, when he will assume the responsibilities of CEO. Bill has done a great job leading the team at SunTrust and I admire their strength and performance during his tenure. He and I share the same values and emphasize a client-first culture, and SunTrust’s team offers the same mix of seasoned leaders and newer members whose fresh perspective is invaluable as we meet the needs of technology-savvy clients.

In 2018, BB&T welcomed independent directors Patrick C. Graney III, founder and president of West Virginia-based private management company PCG Inc., and Easter A. Maynard, a director and leader of the charitable arm of North Carolina-based Investors Management Corporation and chair of the board of Golden Corral Corporation. I want to express my deepest appreciation to Eric Kendrick, who retired from our board of directors at year end. As the president of Mereck Associates Inc., Eric provided broad business experience and a valuable perspective to help guide BB&T since joining our board 15 years ago. Our combined board of directors also will be evenly split between the two companies, with SunTrust lead director David M. Ratcliffe continuing in that role until March 2022.

I am confident we will successfully complete the best merger of equals in banking history. BB&T and SunTrust have collectively integrated nearly 100 mergers successfully over the last 35 years. We adhere to a diligent transition process, understand each other’s businesses well, have similar conservative risk cultures and, most importantly, care deeply about our clients, associates, communities and shareholders.

Individually, BB&T is strong. Together with SunTrust, we will be the best. I have never been more optimistic that our best days are ahead!

Kelly S. King

Chairman and Chief Executive Officer

Feb. 25, 2019