Date of Report (Date of earliest event reported): | July 26, 2017 |
Georgia | 001-08918 | 58-1575035 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
303 Peachtree Street, N.E., Atlanta, Georgia | 30308 | |
(Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code | (800) 786-8787 |
Not Applicable | ||||
Former name or former address, if changed since last report |
SUNTRUST BANKS, INC. | |||||
(Registrant) | |||||
Date: | July 26, 2017 | By: /s/ R. Ryan Richards | |||
R. Ryan Richards, Senior Vice President, Controller |
• | Net income available to common shareholders was $505 million, or $1.03 per average common diluted share, compared to $0.91 for the prior quarter and $0.94 for the second quarter of 2016. |
• | Total revenue increased 1% compared to the prior quarter and 2% compared to the second quarter of 2016. |
◦ | These increases were driven largely by higher net interest income as a result of net interest margin expansion and growth in earning assets. |
• | Net interest margin was 3.14% in the current quarter, up 5 basis points sequentially and up 15 basis points compared to the prior year, driven by higher earning asset yields arising from higher benchmark interest rates, continued positive mix shift in the loan portfolio, and lower premium amortization in the securities portfolio. |
• | Provision for credit losses decreased $29 million sequentially and $56 million year-over-year primarily as a result of lower net charge-offs. |
• | Noninterest expense declined 5% sequentially and increased 3% compared to the prior year. |
◦ | The sequential decrease was driven primarily by a seasonal decline in personnel costs, higher branch closure and severance costs recognized in the prior quarter, and lower operating losses. |
◦ | The increase relative to the prior year was driven primarily by the recent acquisition of Pillar & Cohen Financial ("Pillar/Cohen"), higher compensation (as a result of improved business performance), higher net occupancy expense, and higher FDIC premiums, partially offset by lower other noninterest expense. |
• | The efficiency and tangible efficiency ratios in the current quarter were 61.2% and 60.6%, respectively, which represent significant improvements compared to the prior quarter, driven primarily by seasonal declines in employee benefits costs, ongoing expense management initiatives, and solid revenue growth. |
• | Average loan balances increased 1% sequentially and 2% year-over-year, driven primarily by growth in consumer lending. |
• | Average consumer and commercial deposits increased slightly sequentially and increased 3% compared to the second quarter of 2016, driven by growth in demand and time deposits. |
• | Estimated capital ratios continue to be well above regulatory requirements. The Common Equity Tier 1 ("CET1") ratio was estimated to be 9.7% as of June 30, 2017, and 9.5% on a fully phased-in basis. |
• | During the quarter, the Company: |
◦ | Issued $750 million of 5.05% preferred stock (Series G) and repurchased $240 million of its outstanding common stock, which completed its share repurchases under its 2016 Capital Plan. |
◦ | Announced its 2017 Capital Plan, which includes: |
▪ | The purchase of up to $1.32 billion of its outstanding common stock between the third quarter of 2017 and the second quarter of 2018 (representing a 38% increase). |
▪ | A 54% increase in the quarterly common stock dividend from $0.26 per share to $0.40 per share, beginning in the third quarter of 2017, subject to approval by the Company's Board of Directors. |
• | Book value per common share was $46.51 and tangible book value per common share was $33.83, both up 2% from March 31, 2017, driven primarily by growth in retained earnings. |
• | Nonperforming loans decreased $35 million from the prior quarter and represented 0.52% of total loans at June 30, 2017. The sequential decrease was driven by the return to accrual status of certain nonperforming energy-related loans during the current quarter. |
• | Net charge-offs for the current quarter were $70 million, or 0.20% of average loans on an annualized basis, down $42 million sequentially and $67 million year-over-year driven by overall asset quality improvements for both periods as well as lower energy-related net charge-offs year-over-year. |
• | The provision for credit losses decreased $29 million sequentially as a result of lower net charge-offs. |
• | At June 30, 2017, the allowance for loan and lease losses ("ALLL") to period-end loans held for investment ("LHFI") ratio was 1.20%, stable compared to the prior quarter. |
Income Statement (Dollars in millions, except per share data) | 2Q 2017 | 1Q 2017 | 4Q 2016 | 2Q 2016 | |||||||||||
Net interest income | $1,403 | $1,366 | $1,343 | $1,288 | |||||||||||
Net interest income-FTE 2 | 1,439 | 1,400 | 1,377 | 1,323 | |||||||||||
Net interest margin | 3.06 | % | 3.02 | % | 2.93 | % | 2.91 | % | |||||||
Net interest margin-FTE 2 | 3.14 | 3.09 | 3.00 | 2.99 | |||||||||||
Noninterest income | $827 | $847 | $815 | $898 | |||||||||||
Total revenue | 2,230 | 2,213 | 2,158 | 2,186 | |||||||||||
Total revenue-FTE 2 | 2,266 | 2,247 | 2,192 | 2,221 | |||||||||||
Noninterest expense | 1,388 | 1,465 | 1,397 | 1,345 | |||||||||||
Provision for credit losses | 90 | 119 | 101 | 146 | |||||||||||
Net income available to common shareholders | 505 | 451 | 448 | 475 | |||||||||||
Earnings per average common diluted share | 1.03 | 0.91 | 0.90 | 0.94 | |||||||||||
Balance Sheet (Dollars in billions) | |||||||||||||||
Average loans held for investment ("LHFI") | $144.4 | $143.7 | $142.6 | $141.2 | |||||||||||
Average consumer and commercial deposits | 159.1 | 158.9 | 158.0 | 154.2 | |||||||||||
Capital | |||||||||||||||
Capital ratios at period end 1 : | |||||||||||||||
Tier 1 capital (transitional) | 10.81 | % | 10.40 | % | 10.28 | % | 10.57 | % | |||||||
Common Equity Tier 1 ("CET1") (transitional) | 9.68 | 9.69 | 9.59 | 9.84 | |||||||||||
Common Equity Tier 1 ("CET1") (fully phased-in) 2 | 9.53 | 9.54 | 9.43 | 9.73 | |||||||||||
Total average shareholders’ equity to total average assets | 11.80 | 11.59 | 11.84 | 12.11 | |||||||||||
Asset Quality | |||||||||||||||
Net charge-offs to average LHFI (annualized) | 0.20 | % | 0.32 | % | 0.38 | % | 0.39 | % | |||||||
ALLL to period-end LHFI | 1.20 | 1.20 | 1.19 | 1.25 | |||||||||||
Nonperforming loans to total loans | 0.52 | 0.55 | 0.59 | 0.67 |
• | The Company presents certain capital information on a tangible basis, including tangible equity, tangible common equity, the ratio of tangible equity to tangible assets, the ratio of tangible common equity to tangible assets, tangible book value per share, and the return on tangible common shareholders’ equity, which removes the after-tax impact of purchase accounting intangible assets from shareholders' equity and removes related intangible asset amortization from net income available to common shareholders. The Company believes these measures are useful to investors because, by removing the amount of intangible assets that result from merger and acquisition activity and amortization expense (the level of which may vary from company to company), it allows investors to more easily compare the Company’s capital position and return on average tangible common shareholders' equity to other companies in the industry who present similar measures. The Company also believes that removing these items provides a more relevant measure of the return on the Company's common shareholders' equity. These measures are utilized by management to assess the capital adequacy and profitability of the Company. |
• | Similarly, the Company presents an efficiency ratio-FTE and a tangible efficiency ratio-FTE. The efficiency ratio is computed by dividing noninterest expense by total revenue. Efficiency ratio-FTE is computed by dividing noninterest expense by total revenue-FTE. The tangible efficiency ratio-FTE excludes the amortization related to intangible assets and certain tax credits. The Company believes this measure is useful to investors because, by removing the impact of amortization (the level of which may vary from company to company), it allows investors to more easily compare the Company’s efficiency to other companies in the industry. This measure is utilized by management to assess the efficiency of the Company and its lines of business. |
• | The Company presents the Basel III Common Equity Tier 1 (CET1) ratio, on a fully phased-in basis. Fully phased-in ratios consider a 250% risk-weighting for MSRs and deduction from capital of certain carryforward DTAs, the overfunded pension asset, and other intangible assets. The Company believes this measure is useful to investors who wish to understand the Company's current compliance with future regulatory requirements. |
(Dollars in millions and shares in thousands, except per share data) (Unaudited) | Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
EARNINGS & DIVIDENDS | |||||||||||||||
Net income | $528 | $492 | $995 | $939 | |||||||||||
Net income available to common shareholders | 505 | 475 | 956 | 906 | |||||||||||
Total revenue | 2,230 | 2,186 | 4,443 | 4,249 | |||||||||||
Total revenue-FTE 1 | 2,266 | 2,221 | 4,513 | 4,320 | |||||||||||
Net income per average common share: | |||||||||||||||
Diluted | $1.03 | $0.94 | $1.94 | $1.78 | |||||||||||
Basic | 1.05 | 0.95 | 1.97 | 1.80 | |||||||||||
Dividends paid per common share | 0.26 | 0.24 | 0.52 | 0.48 | |||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||||
Selected Average Balances: | |||||||||||||||
Total assets | $204,494 | $198,305 | $204,374 | $195,660 | |||||||||||
Earning assets | 184,057 | 178,055 | 183,833 | 176,122 | |||||||||||
Loans held for investment ("LHFI") | 144,440 | 141,238 | 144,058 | 139,805 | |||||||||||
Intangible assets including mortgage servicing rights ("MSRs") | 8,024 | 7,543 | 8,025 | 7,556 | |||||||||||
MSRs | 1,603 | 1,192 | 1,603 | 1,203 | |||||||||||
Consumer and commercial deposits | 159,136 | 154,166 | 159,006 | 151,698 | |||||||||||
Total shareholders’ equity | 24,139 | 24,018 | 23,906 | 23,907 | |||||||||||
Preferred stock | 1,720 | 1,225 | 1,474 | 1,225 | |||||||||||
Period End Balances: | |||||||||||||||
Total assets | $207,223 | $198,892 | |||||||||||||
Earning assets | 184,518 | 178,852 | |||||||||||||
LHFI | 144,268 | 141,656 | |||||||||||||
Allowance for loan and lease losses ("ALLL") | 1,731 | 1,774 | |||||||||||||
Consumer and commercial deposits | 158,319 | 151,779 | |||||||||||||
Total shareholders’ equity | 24,477 | 24,464 | |||||||||||||
FINANCIAL RATIOS & OTHER DATA | |||||||||||||||
Return on average total assets | 1.03 | % | 1.00 | % | 0.98 | % | 0.97 | % | |||||||
Return on average common shareholders’ equity | 9.08 | 8.43 | 8.64 | 8.07 | |||||||||||
Return on average tangible common shareholders' equity 1 | 12.51 | 11.54 | 11.90 | 11.07 | |||||||||||
Net interest margin | 3.06 | 2.91 | 3.04 | 2.93 | |||||||||||
Net interest margin-FTE 1 | 3.14 | 2.99 | 3.11 | 3.01 | |||||||||||
Efficiency ratio | 62.24 | 61.53 | 64.21 | 62.67 | |||||||||||
Efficiency ratio-FTE 1 | 61.24 | 60.56 | 63.21 | 61.65 | |||||||||||
Tangible efficiency ratio-FTE 1 | 60.59 | 60.05 | 62.59 | 61.16 | |||||||||||
Effective tax rate | 30 | 29 | 28 | 30 | |||||||||||
Basel III capital ratios at period end (transitional) 2: | |||||||||||||||
Common Equity Tier 1 ("CET1") | 9.68 | % | 9.84 | % | |||||||||||
Tier 1 capital | 10.81 | 10.57 | |||||||||||||
Total capital | 12.75 | 12.68 | |||||||||||||
Leverage | 9.55 | 9.35 | |||||||||||||
Basel III fully phased-in CET1 ratio 1, 2 | 9.53 | 9.73 | |||||||||||||
Total average shareholders’ equity to total average assets | 11.80 | % | 12.11 | % | 11.70 | 12.22 | |||||||||
Tangible equity to tangible assets 1 | 9.15 | 9.54 | |||||||||||||
Tangible common equity to tangible assets 1 | 8.11 | 8.85 | |||||||||||||
Book value per common share | $46.51 | $46.14 | |||||||||||||
Tangible book value per common share 1 | 33.83 | 33.98 | |||||||||||||
Market capitalization | 27,319 | 20,598 | |||||||||||||
Average common shares outstanding: | |||||||||||||||
Diluted | 488,020 | 505,633 | 491,989 | 508,012 | |||||||||||
Basic | 482,913 | 501,374 | 486,482 | 503,428 | |||||||||||
Full-time equivalent employees | 24,278 | 23,940 | |||||||||||||
Number of ATMs | 2,104 | 2,144 | |||||||||||||
Full service banking offices | 1,281 | 1,389 | |||||||||||||
1 | See Appendix A for additional information and reconcilements of non-U.S. GAAP performance measures. |
2 | Current period capital ratios are estimated as of the document date. |
Three Months Ended | |||||||||||||||
June 30 | March 31 | December 31 | June 30 | ||||||||||||
(Dollars in millions and shares in thousands, except per share data) (Unaudited) | 2017 | 2017 | 2016 | 2016 | |||||||||||
EARNINGS & DIVIDENDS | |||||||||||||||
Net income | $528 | $468 | $465 | $492 | |||||||||||
Net income available to common shareholders | 505 | 451 | 448 | 475 | |||||||||||
Total revenue | 2,230 | 2,213 | 2,158 | 2,186 | |||||||||||
Total revenue-FTE 1 | 2,266 | 2,247 | 2,192 | 2,221 | |||||||||||
Net income per average common share: | |||||||||||||||
Diluted | $1.03 | $0.91 | $0.90 | $0.94 | |||||||||||
Basic | 1.05 | 0.92 | 0.91 | 0.95 | |||||||||||
Dividends paid per common share | 0.26 | 0.26 | 0.26 | 0.24 | |||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||||
Selected Average Balances: | |||||||||||||||
Total assets | $204,494 | $204,252 | $203,146 | $198,305 | |||||||||||
Earning assets | 184,057 | 183,606 | 182,475 | 178,055 | |||||||||||
LHFI | 144,440 | 143,670 | 142,578 | 141,238 | |||||||||||
Intangible assets including MSRs | 8,024 | 8,026 | 7,654 | 7,543 | |||||||||||
MSRs | 1,603 | 1,604 | 1,291 | 1,192 | |||||||||||
Consumer and commercial deposits | 159,136 | 158,874 | 157,996 | 154,166 | |||||||||||
Total shareholders’ equity | 24,139 | 23,671 | 24,044 | 24,018 | |||||||||||
Preferred stock | 1,720 | 1,225 | 1,225 | 1,225 | |||||||||||
Period End Balances: | |||||||||||||||
Total assets | $207,223 | $205,642 | $204,875 | $198,892 | |||||||||||
Earning assets | 184,518 | 183,279 | 184,610 | 178,852 | |||||||||||
LHFI | 144,268 | 143,529 | 143,298 | 141,656 | |||||||||||
ALLL | 1,731 | 1,714 | 1,709 | 1,774 | |||||||||||
Consumer and commercial deposits | 158,319 | 161,531 | 158,864 | 151,779 | |||||||||||
Total shareholders’ equity | 24,477 | 23,484 | 23,618 | 24,464 | |||||||||||
FINANCIAL RATIOS & OTHER DATA | |||||||||||||||
Return on average total assets | 1.03 | % | 0.93 | % | 0.91 | % | 1.00 | % | |||||||
Return on average common shareholders’ equity | 9.08 | 8.19 | 7.85 | 8.43 | |||||||||||
Return on average tangible common shareholders' equity 1 | 12.51 | 11.28 | 10.76 | 11.54 | |||||||||||
Net interest margin | 3.06 | 3.02 | 2.93 | 2.91 | |||||||||||
Net interest margin-FTE 1 | 3.14 | 3.09 | 3.00 | 2.99 | |||||||||||
Efficiency ratio | 62.24 | 66.20 | 64.74 | 61.53 | |||||||||||
Efficiency ratio-FTE 1 | 61.24 | 65.19 | 63.73 | 60.56 | |||||||||||
Tangible efficiency ratio-FTE 1 | 60.59 | 64.60 | 63.08 | 60.05 | |||||||||||
Effective tax rate | 30 | 25 | 29 | 29 | |||||||||||
Basel III capital ratios at period end (transitional) 2: | |||||||||||||||
CET1 | 9.68 | % | 9.69 | % | 9.59 | % | 9.84 | % | |||||||
Tier 1 capital | 10.81 | 10.40 | 10.28 | 10.57 | |||||||||||
Total capital | 12.75 | 12.37 | 12.26 | 12.68 | |||||||||||
Leverage | 9.55 | 9.08 | 9.22 | 9.35 | |||||||||||
Basel III fully phased-in CET1 ratio 1, 2 | 9.53 | 9.54 | 9.43 | 9.73 | |||||||||||
Total average shareholders’ equity to total average assets | 11.80 | 11.59 | 11.84 | 12.11 | |||||||||||
Tangible equity to tangible assets 1 | 9.15 | 8.72 | 8.82 | 9.54 | |||||||||||
Tangible common equity to tangible assets 1 | 8.11 | 8.06 | 8.15 | 8.85 | |||||||||||
Book value per common share | $46.51 | $45.62 | $45.38 | $46.14 | |||||||||||
Tangible book value per common share 1 | 33.83 | 33.05 | 32.95 | 33.98 | |||||||||||
Market capitalization | 27,319 | 26,860 | 26,942 | 20,598 | |||||||||||
Average common shares outstanding: | |||||||||||||||
Diluted | 488,020 | 496,002 | 497,055 | 505,633 | |||||||||||
Basic | 482,913 | 490,091 | 491,497 | 501,374 | |||||||||||
Full-time equivalent employees | 24,278 | 24,215 | 24,375 | 23,940 | |||||||||||
Number of ATMs | 2,104 | 2,132 | 2,165 | 2,144 | |||||||||||
Full service banking offices | 1,281 | 1,316 | 1,367 | 1,389 | |||||||||||
1 | See Appendix A for additional information and reconcilements of non-U.S. GAAP performance measures. |
2 | Current period capital ratios are estimated as of the document date. |
Three Months Ended | Six Months Ended | ||||||||||||||
(Dollars in millions and shares in thousands, except per share data) (Unaudited) | June 30 | June 30 | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Interest income | $1,583 | $1,424 | $3,111 | $2,834 | |||||||||||
Interest expense | 180 | 136 | 342 | 265 | |||||||||||
NET INTEREST INCOME | 1,403 | 1,288 | 2,769 | 2,569 | |||||||||||
Provision for credit losses | 90 | 146 | 209 | 246 | |||||||||||
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 1,313 | 1,142 | 2,560 | 2,323 | |||||||||||
NONINTEREST INCOME | |||||||||||||||
Service charges on deposit accounts | 151 | 162 | 299 | 315 | |||||||||||
Other charges and fees | 103 | 104 | 198 | 197 | |||||||||||
Card fees | 87 | 83 | 169 | 160 | |||||||||||
Investment banking income | 147 | 126 | 314 | 225 | |||||||||||
Trading income | 46 | 34 | 97 | 89 | |||||||||||
Trust and investment management income | 76 | 75 | 151 | 150 | |||||||||||
Retail investment services | 70 | 72 | 139 | 141 | |||||||||||
Mortgage production related income | 56 | 111 | 109 | 171 | |||||||||||
Mortgage servicing related income | 44 | 52 | 102 | 114 | |||||||||||
Commercial real estate related income 1 | 24 | 10 | 44 | 28 | |||||||||||
Net securities gains | 1 | 4 | 1 | 4 | |||||||||||
Other noninterest income 1 | 22 | 65 | 51 | 86 | |||||||||||
Total noninterest income | 827 | 898 | 1,674 | 1,680 | |||||||||||
NONINTEREST EXPENSE | |||||||||||||||
Employee compensation and benefits | 796 | 763 | 1,648 | 1,536 | |||||||||||
Outside processing and software | 204 | 202 | 409 | 400 | |||||||||||
Net occupancy expense | 94 | 78 | 185 | 163 | |||||||||||
Equipment expense | 43 | 42 | 83 | 82 | |||||||||||
FDIC premium/regulatory exams | 49 | 44 | 97 | 80 | |||||||||||
Marketing and customer development | 42 | 38 | 84 | 82 | |||||||||||
Operating losses | 19 | 25 | 51 | 50 | |||||||||||
Amortization | 15 | 11 | 28 | 21 | |||||||||||
Other noninterest expense | 126 | 142 | 268 | 249 | |||||||||||
Total noninterest expense | 1,388 | 1,345 | 2,853 | 2,663 | |||||||||||
INCOME BEFORE PROVISION FOR INCOME TAXES | 752 | 695 | 1,381 | 1,340 | |||||||||||
Provision for income taxes | 222 | 201 | 381 | 396 | |||||||||||
NET INCOME INCLUDING INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST | 530 | 494 | 1,000 | 944 | |||||||||||
Net income attributable to noncontrolling interest | 2 | 2 | 5 | 5 | |||||||||||
NET INCOME | $528 | $492 | $995 | $939 | |||||||||||
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | $505 | $475 | $956 | $906 | |||||||||||
Net interest income-FTE 2 | 1,439 | 1,323 | 2,839 | 2,640 | |||||||||||
Total revenue | 2,230 | 2,186 | 4,443 | 4,249 | |||||||||||
Total revenue-FTE 2 | 2,266 | 2,221 | 4,513 | 4,320 | |||||||||||
Net income per average common share: | |||||||||||||||
Diluted | 1.03 | 0.94 | 1.94 | 1.78 | |||||||||||
Basic | 1.05 | 0.95 | 1.97 | 1.80 | |||||||||||
Cash dividends paid per common share | 0.26 | 0.24 | 0.52 | 0.48 | |||||||||||
Average common shares outstanding: | |||||||||||||||
Diluted | 488,020 | 505,633 | 491,989 | 508,012 | |||||||||||
Basic | 482,913 | 501,374 | 486,482 | 503,428 | |||||||||||
Three Months Ended | |||||||||||||||
(Dollars in millions and shares in thousands, except per share data) (Unaudited) | June 30 | March 31 | December 31 | June 30 | |||||||||||
2017 | 2017 | 2016 | 2016 | ||||||||||||
Interest income | $1,583 | $1,528 | $1,492 | $1,424 | |||||||||||
Interest expense | 180 | 162 | 149 | 136 | |||||||||||
NET INTEREST INCOME | 1,403 | 1,366 | 1,343 | 1,288 | |||||||||||
Provision for credit losses | 90 | 119 | 101 | 146 | |||||||||||
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 1,313 | 1,247 | 1,242 | 1,142 | |||||||||||
NONINTEREST INCOME | |||||||||||||||
Service charges on deposit accounts | 151 | 148 | 154 | 162 | |||||||||||
Other charges and fees | 103 | 95 | 90 | 104 | |||||||||||
Card fees | 87 | 82 | 84 | 83 | |||||||||||
Investment banking income | 147 | 167 | 122 | 126 | |||||||||||
Trading income | 46 | 51 | 58 | 34 | |||||||||||
Trust and investment management income | 76 | 75 | 73 | 75 | |||||||||||
Retail investment services | 70 | 68 | 69 | 72 | |||||||||||
Mortgage production related income | 56 | 53 | 78 | 111 | |||||||||||
Mortgage servicing related income | 44 | 58 | 25 | 52 | |||||||||||
Commercial real estate related income 1 | 24 | 20 | 33 | 10 | |||||||||||
Net securities gains | 1 | — | — | 4 | |||||||||||
Other noninterest income 1 | 22 | 30 | 29 | 65 | |||||||||||
Total noninterest income | 827 | 847 | 815 | 898 | |||||||||||
NONINTEREST EXPENSE | |||||||||||||||
Employee compensation and benefits | 796 | 852 | 762 | 763 | |||||||||||
Outside processing and software | 204 | 205 | 209 | 202 | |||||||||||
Net occupancy expense | 94 | 92 | 94 | 78 | |||||||||||
Equipment expense | 43 | 39 | 43 | 42 | |||||||||||
FDIC premium/regulatory exams | 49 | 48 | 46 | 44 | |||||||||||
Marketing and customer development | 42 | 42 | 52 | 38 | |||||||||||
Operating losses | 19 | 32 | 23 | 25 | |||||||||||
Amortization | 15 | 13 | 14 | 11 | |||||||||||
Other noninterest expense | 126 | 142 | 154 | 142 | |||||||||||
Total noninterest expense | 1,388 | 1,465 | 1,397 | 1,345 | |||||||||||
INCOME BEFORE PROVISION FOR INCOME TAXES | 752 | 629 | 660 | 695 | |||||||||||
Provision for income taxes | 222 | 159 | 193 | 201 | |||||||||||
NET INCOME INCLUDING INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST | 530 | 470 | 467 | 494 | |||||||||||
Net income attributable to noncontrolling interest | 2 | 2 | 2 | 2 | |||||||||||
NET INCOME | $528 | $468 | $465 | $492 | |||||||||||
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | $505 | $451 | $448 | $475 | |||||||||||
Net interest income-FTE 2 | 1,439 | 1,400 | 1,377 | 1,323 | |||||||||||
Total revenue | 2,230 | 2,213 | 2,158 | 2,186 | |||||||||||
Total revenue-FTE 2 | 2,266 | 2,247 | 2,192 | 2,221 | |||||||||||
Net income per average common share: | |||||||||||||||
Diluted | 1.03 | 0.91 | 0.90 | 0.94 | |||||||||||
Basic | 1.05 | 0.92 | 0.91 | 0.95 | |||||||||||
Cash dividends paid per common share | 0.26 | 0.26 | 0.26 | 0.24 | |||||||||||
Average common shares outstanding: | |||||||||||||||
Diluted | 488,020 | 496,002 | 497,055 | 505,633 | |||||||||||
Basic | 482,913 | 490,091 | 491,497 | 501,374 | |||||||||||
June 30 | |||||||
(Dollars in millions and shares in thousands, except per share data) (Unaudited) | 2017 | 2016 | |||||
ASSETS | |||||||
Cash and due from banks | $6,968 | $4,134 | |||||
Federal funds sold and securities borrowed or purchased under agreements to resell | 1,249 | 1,107 | |||||
Interest-bearing deposits in other banks | 24 | 24 | |||||
Trading assets and derivative instruments | 5,847 | 6,850 | |||||
Securities available for sale | 31,142 | 29,336 | |||||
Loans held for sale ("LHFS") | 2,826 | 2,468 | |||||
Loans held for investment ("LHFI"): | |||||||
Commercial and industrial ("C&I") | 68,511 | 68,603 | |||||
Commercial real estate ("CRE") | 5,250 | 6,228 | |||||
Commercial construction | 4,019 | 2,617 | |||||
Residential mortgages - guaranteed | 501 | 534 | |||||
Residential mortgages - nonguaranteed | 26,594 | 26,037 | |||||
Residential home equity products | 11,173 | 12,481 | |||||
Residential construction | 364 | 397 | |||||
Consumer student - guaranteed | 6,543 | 5,562 | |||||
Consumer other direct | 8,249 | 6,825 | |||||
Consumer indirect | 11,639 | 11,195 | |||||
Consumer credit cards | 1,425 | 1,177 | |||||
Total LHFI | 144,268 | 141,656 | |||||
Allowance for loan and lease losses ("ALLL") | (1,731 | ) | (1,774 | ) | |||
Net loans held for investment | 142,537 | 139,882 | |||||
Goodwill | 6,338 | 6,337 | |||||
MSRs | 1,608 | 1,061 | |||||
Other assets | 8,684 | 7,693 | |||||
Total assets 1 | $207,223 | $198,892 | |||||
LIABILITIES | |||||||
Deposits: | |||||||
Noninterest-bearing consumer and commercial deposits | $44,006 | $42,466 | |||||
Interest-bearing consumer and commercial deposits: | |||||||
NOW accounts | 43,973 | 39,869 | |||||
Money market accounts | 53,000 | 53,410 | |||||
Savings | 6,599 | 6,343 | |||||
Consumer time | 5,610 | 5,836 | |||||
Other time | 5,131 | 3,855 | |||||
Total consumer and commercial deposits | 158,319 | 151,779 | |||||
Brokered time deposits | 944 | 972 | |||||
Foreign deposits | 610 | — | |||||
Total deposits | 159,873 | 152,751 | |||||
Funds purchased | 3,007 | 1,352 | |||||
Securities sold under agreements to repurchase | 1,503 | 1,622 | |||||
Other short-term borrowings | 2,640 | 1,883 | |||||
Long-term debt | 10,511 | 12,264 | |||||
Trading liabilities and derivative instruments | 1,090 | 1,245 | |||||
Other liabilities | 4,122 | 3,311 | |||||
Total liabilities | 182,746 | 174,428 | |||||
SHAREHOLDERS' EQUITY | |||||||
Preferred stock, no par value | 1,975 | 1,225 | |||||
Common stock, $1.00 par value | 550 | 550 | |||||
Additional paid-in capital | 8,973 | 9,003 | |||||
Retained earnings | 16,701 | 15,353 | |||||
Treasury stock, at cost, and other | (2,945 | ) | (1,900 | ) | |||
Accumulated other comprehensive (loss)/income, net of tax | (777 | ) | 233 | ||||
Total shareholders' equity | 24,477 | 24,464 | |||||
Total liabilities and shareholders' equity | $207,223 | $198,892 | |||||
Common shares outstanding | 481,644 | 501,412 | |||||
Common shares authorized | 750,000 | 750,000 | |||||
Preferred shares outstanding | 20 | 12 | |||||
Preferred shares authorized | 50,000 | 50,000 | |||||
Treasury shares of common stock | 68,369 | 48,509 |
(Dollars in millions and shares in thousands, except per share data) (Unaudited) | June 30 | March 31 | December 31 | June 30 | |||||||||||
2017 | 2017 | 2016 | 2016 | ||||||||||||
ASSETS | |||||||||||||||
Cash and due from banks | $6,968 | $6,957 | $5,091 | $4,134 | |||||||||||
Federal funds sold and securities borrowed or purchased under agreements to resell | 1,249 | 1,292 | 1,307 | 1,107 | |||||||||||
Interest-bearing deposits in other banks | 24 | 25 | 25 | 24 | |||||||||||
Trading assets and derivative instruments | 5,847 | 6,007 | 6,067 | 6,850 | |||||||||||
Securities available for sale | 31,142 | 31,127 | 30,672 | 29,336 | |||||||||||
LHFS | 2,826 | 2,109 | 4,169 | 2,468 | |||||||||||
LHFI: | |||||||||||||||
C&I | 68,511 | 68,971 | 69,213 | 68,603 | |||||||||||
CRE | 5,250 | 5,067 | 4,996 | 6,228 | |||||||||||
Commercial construction | 4,019 | 4,215 | 4,015 | 2,617 | |||||||||||
Residential mortgages - guaranteed | 501 | 549 | 537 | 534 | |||||||||||
Residential mortgages - nonguaranteed | 26,594 | 26,110 | 26,137 | 26,037 | |||||||||||
Residential home equity products | 11,173 | 11,511 | 11,912 | 12,481 | |||||||||||
Residential construction | 364 | 380 | 404 | 397 | |||||||||||
Consumer student - guaranteed | 6,543 | 6,396 | 6,167 | 5,562 | |||||||||||
Consumer other direct | 8,249 | 7,904 | 7,771 | 6,825 | |||||||||||
Consumer indirect | 11,639 | 11,067 | 10,736 | 11,195 | |||||||||||
Consumer credit cards | 1,425 | 1,359 | 1,410 | 1,177 | |||||||||||
Total LHFI | 144,268 | 143,529 | 143,298 | 141,656 | |||||||||||
ALLL | (1,731 | ) | (1,714 | ) | (1,709 | ) | (1,774 | ) | |||||||
Net loans held for investment | 142,537 | 141,815 | 141,589 | 139,882 | |||||||||||
Goodwill | 6,338 | 6,338 | 6,337 | 6,337 | |||||||||||
MSRs | 1,608 | 1,645 | 1,572 | 1,061 | |||||||||||
Other assets | 8,684 | 8,327 | 8,046 | 7,693 | |||||||||||
Total assets 1 | $207,223 | $205,642 | $204,875 | $198,892 | |||||||||||
LIABILITIES | |||||||||||||||
Deposits: | |||||||||||||||
Noninterest-bearing consumer and commercial deposits | $44,006 | $43,437 | $43,431 | $42,466 | |||||||||||
Interest-bearing consumer and commercial deposits: | |||||||||||||||
NOW accounts | 43,973 | 46,222 | 45,534 | 39,869 | |||||||||||
Money market accounts | 53,000 | 55,261 | 54,166 | 53,410 | |||||||||||
Savings | 6,599 | 6,668 | 6,266 | 6,343 | |||||||||||
Consumer time | 5,610 | 5,495 | 5,534 | 5,836 | |||||||||||
Other time | 5,131 | 4,448 | 3,933 | 3,855 | |||||||||||
Total consumer and commercial deposits | 158,319 | 161,531 | 158,864 | 151,779 | |||||||||||
Brokered time deposits | 944 | 917 | 924 | 972 | |||||||||||
Foreign deposits | 610 | 405 | 610 | — | |||||||||||
Total deposits | 159,873 | 162,853 | 160,398 | 152,751 | |||||||||||
Funds purchased | 3,007 | 1,037 | 2,116 | 1,352 | |||||||||||
Securities sold under agreements to repurchase | 1,503 | 1,704 | 1,633 | 1,622 | |||||||||||
Other short-term borrowings | 2,640 | 1,955 | 1,015 | 1,883 | |||||||||||
Long-term debt | 10,511 | 10,496 | 11,748 | 12,264 | |||||||||||
Trading liabilities and derivative instruments | 1,090 | 1,225 | 1,351 | 1,245 | |||||||||||
Other liabilities | 4,122 | 2,888 | 2,996 | 3,311 | |||||||||||
Total liabilities | 182,746 | 182,158 | 181,257 | 174,428 | |||||||||||
SHAREHOLDERS’ EQUITY | |||||||||||||||
Preferred stock, no par value | 1,975 | 1,225 | 1,225 | 1,225 | |||||||||||
Common stock, $1.00 par value | 550 | 550 | 550 | 550 | |||||||||||
Additional paid-in capital | 8,973 | 8,966 | 9,010 | 9,003 | |||||||||||
Retained earnings | 16,701 | 16,322 | 16,000 | 15,353 | |||||||||||
Treasury stock, at cost, and other | (2,945 | ) | (2,712 | ) | (2,346 | ) | (1,900 | ) | |||||||
Accumulated other comprehensive (loss)/income, net of tax | (777 | ) | (867 | ) | (821 | ) | 233 | ||||||||
Total shareholders’ equity | 24,477 | 23,484 | 23,618 | 24,464 | |||||||||||
Total liabilities and shareholders’ equity | $207,223 | $205,642 | $204,875 | $198,892 | |||||||||||
Common shares outstanding | 481,644 | 485,712 | 491,188 | 501,412 | |||||||||||
Common shares authorized | 750,000 | 750,000 | 750,000 | 750,000 | |||||||||||
Preferred shares outstanding | 20 | 12 | 12 | 12 | |||||||||||
Preferred shares authorized | 50,000 | 50,000 | 50,000 | 50,000 | |||||||||||
Treasury shares of common stock | 68,369 | 64,301 | 58,738 | 48,509 |
SunTrust Banks, Inc. and Subsidiaries CONSOLIDATED DAILY AVERAGE BALANCES, INCOME/EXPENSE, AND AVERAGE YIELDS EARNED/RATES PAID | |||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||
June 30, 2017 | March 31, 2017 | ||||||||||||||||||||
(Dollars in millions) (Unaudited) | Average Balances | Interest Income/ Expense | Yields/ Rates | Average Balances | Interest Income/ Expense | Yields/ Rates | |||||||||||||||
ASSETS | |||||||||||||||||||||
Loans held for investment ("LHFI"): 1 | |||||||||||||||||||||
Commercial and industrial ("C&I") | $69,122 | $574 | 3.33 | % | $69,076 | $554 | 3.25 | % | |||||||||||||
Commercial real estate ("CRE") | 5,157 | 44 | 3.38 | 5,038 | 39 | 3.18 | |||||||||||||||
Commercial construction | 4,105 | 37 | 3.63 | 4,076 | 34 | 3.39 | |||||||||||||||
Residential mortgages - guaranteed | 532 | 4 | 2.95 | 567 | 4 | 3.07 | |||||||||||||||
Residential mortgages - nonguaranteed | 26,090 | 248 | 3.80 | 25,918 | 247 | 3.80 | |||||||||||||||
Residential home equity products | 11,113 | 118 | 4.27 | 11,466 | 116 | 4.10 | |||||||||||||||
Residential construction | 363 | 4 | 4.19 | 385 | 4 | 4.04 | |||||||||||||||
Consumer student - guaranteed | 6,462 | 71 | 4.42 | 6,278 | 65 | 4.20 | |||||||||||||||
Consumer other direct | 8,048 | 97 | 4.84 | 7,819 | 97 | 5.02 | |||||||||||||||
Consumer indirect | 11,284 | 98 | 3.50 | 10,847 | 92 | 3.43 | |||||||||||||||
Consumer credit cards | 1,391 | 35 | 9.96 | 1,369 | 33 | 9.79 | |||||||||||||||
Nonaccrual | 773 | 8 | 4.37 | 831 | 4 | 2.03 | |||||||||||||||
Total LHFI | 144,440 | 1,338 | 3.72 | 143,670 | 1,289 | 3.64 | |||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Taxable | 30,654 | 189 | 2.47 | 30,590 | 185 | 2.42 | |||||||||||||||
Tax-exempt | 348 | 3 | 3.04 | 286 | 2 | 3.04 | |||||||||||||||
Total securities available for sale | 31,002 | 192 | 2.47 | 30,876 | 187 | 2.42 | |||||||||||||||
Federal funds sold and securities borrowed or purchased under agreements to resell | 1,237 | 2 | 0.68 | 1,236 | 1 | 0.33 | |||||||||||||||
Loans held for sale ("LHFS") | 2,222 | 21 | 3.86 | 2,611 | 24 | 3.71 | |||||||||||||||
Interest-bearing deposits in other banks | 25 | — | 0.62 | 25 | — | 0.64 | |||||||||||||||
Interest earning trading assets | 5,131 | 30 | 2.33 | 5,188 | 27 | 2.09 | |||||||||||||||
Total earning assets | 184,057 | 1,583 | 3.45 | 183,606 | 1,528 | 3.38 | |||||||||||||||
Allowance for loan and lease losses ("ALLL") | (1,723 | ) | (1,700 | ) | |||||||||||||||||
Cash and due from banks | 4,901 | 5,556 | |||||||||||||||||||
Other assets | 16,248 | 15,952 | |||||||||||||||||||
Noninterest earning trading assets and derivative instruments | 918 | 888 | |||||||||||||||||||
Unrealized gains/(losses) on securities available for sale, net | 93 | (50 | ) | ||||||||||||||||||
Total assets | $204,494 | $204,252 | |||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||
Interest-bearing deposits: | |||||||||||||||||||||
NOW accounts | $44,437 | $30 | 0.27 | % | $44,745 | $23 | 0.21 | % | |||||||||||||
Money market accounts | 54,199 | 38 | 0.28 | 54,902 | 34 | 0.25 | |||||||||||||||
Savings | 6,638 | — | 0.03 | 6,415 | — | 0.02 | |||||||||||||||
Consumer time | 5,555 | 10 | 0.71 | 5,487 | 9 | 0.69 | |||||||||||||||
Other time | 4,691 | 12 | 1.05 | 4,232 | 10 | 0.97 | |||||||||||||||
Total interest-bearing consumer and commercial deposits | 115,520 | 90 | 0.31 | 115,781 | 76 | 0.27 | |||||||||||||||
Brokered time deposits | 929 | 3 | 1.29 | 917 | 3 | 1.28 | |||||||||||||||
Foreign deposits | 720 | 2 | 0.95 | 678 | 1 | 0.66 | |||||||||||||||
Total interest-bearing deposits | 117,169 | 95 | 0.32 | 117,376 | 80 | 0.28 | |||||||||||||||
Funds purchased | 1,155 | 3 | 0.96 | 872 | 1 | 0.65 | |||||||||||||||
Securities sold under agreements to repurchase | 1,572 | 3 | 0.89 | 1,715 | 3 | 0.61 | |||||||||||||||
Interest-bearing trading liabilities | 992 | 6 | 2.66 | 1,002 | 6 | 2.61 | |||||||||||||||
Other short-term borrowings | 2,008 | 3 | 0.55 | 1,753 | 2 | 0.49 | |||||||||||||||
Long-term debt | 10,518 | 70 | 2.66 | 11,563 | 70 | 2.45 | |||||||||||||||
Total interest-bearing liabilities | 133,414 | 180 | 0.54 | 134,281 | 162 | 0.49 | |||||||||||||||
Noninterest-bearing deposits | 43,616 | 43,093 | |||||||||||||||||||
Other liabilities | 2,976 | 2,860 | |||||||||||||||||||
Noninterest-bearing trading liabilities and derivative instruments | 349 | 347 | |||||||||||||||||||
Shareholders’ equity | 24,139 | 23,671 | |||||||||||||||||||
Total liabilities and shareholders’ equity | $204,494 | $204,252 | |||||||||||||||||||
Interest Rate Spread | 2.91 | % | 2.89 | % | |||||||||||||||||
Net Interest Income | $1,403 | $1,366 | |||||||||||||||||||
Net Interest Income-FTE 2 | $1,439 | $1,400 | |||||||||||||||||||
Net Interest Margin 3 | 3.06 | % | 3.02 | % | |||||||||||||||||
Net Interest Margin-FTE 2, 3 | 3.14 | 3.09 |
SunTrust Banks, Inc. and Subsidiaries CONSOLIDATED DAILY AVERAGE BALANCES, INCOME/EXPENSE, AND AVERAGE YIELDS EARNED/RATES PAID, continued | |||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||
December 31, 2016 | June 30, 2016 | ||||||||||||||||||||
(Dollars in millions) (Unaudited) | Average Balances | Interest Income/ Expense | Yields/ Rates | Average Balances | Interest Income/ Expense | Yields/ Rates | |||||||||||||||
ASSETS | |||||||||||||||||||||
LHFI: 1 | |||||||||||||||||||||
C&I | $68,407 | $549 | 3.19 | % | $68,918 | $533 | 3.11 | % | |||||||||||||
CRE | 5,141 | 38 | 2.93 | 6,055 | 44 | 2.91 | |||||||||||||||
Commercial construction | 3,852 | 31 | 3.22 | 2,589 | 21 | 3.25 | |||||||||||||||
Residential mortgages - guaranteed | 542 | 4 | 2.57 | 580 | 6 | 3.98 | |||||||||||||||
Residential mortgages - nonguaranteed | 26,065 | 244 | 3.75 | 25,408 | 241 | 3.80 | |||||||||||||||
Residential home equity products | 11,809 | 116 | 3.91 | 12,464 | 122 | 3.95 | |||||||||||||||
Residential construction | 382 | 4 | 4.24 | 376 | 4 | 4.41 | |||||||||||||||
Consumer student - guaranteed | 5,990 | 62 | 4.12 | 5,412 | 54 | 3.98 | |||||||||||||||
Consumer other direct | 7,556 | 88 | 4.64 | 6,590 | 74 | 4.54 | |||||||||||||||
Consumer indirect | 10,633 | 92 | 3.44 | 10,771 | 90 | 3.37 | |||||||||||||||
Consumer credit cards | 1,324 | 33 | 9.93 | 1,125 | 29 | 10.09 | |||||||||||||||
Nonaccrual | 877 | 8 | 3.77 | 950 | 4 | 1.67 | |||||||||||||||
Total LHFI | 142,578 | 1,269 | 3.54 | 141,238 | 1,222 | 3.48 | |||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Taxable | 29,314 | 166 | 2.27 | 27,910 | 159 | 2.29 | |||||||||||||||
Tax-exempt | 273 | 2 | 3.08 | 151 | 2 | 3.60 | |||||||||||||||
Total securities available for sale | 29,587 | 168 | 2.28 | 28,061 | 161 | 2.29 | |||||||||||||||
Federal funds sold and securities borrowed or purchased under agreements to resell | 1,332 | — | (0.03 | ) | 1,227 | — | 0.17 | ||||||||||||||
LHFS | 3,570 | 30 | 3.42 | 2,015 | 18 | 3.61 | |||||||||||||||
Interest-bearing deposits in other banks | 24 | — | 0.47 | 23 | — | 0.29 | |||||||||||||||
Interest earning trading assets | 5,384 | 25 | 1.83 | 5,491 | 23 | 1.65 | |||||||||||||||
Total earning assets | 182,475 | 1,492 | 3.25 | 178,055 | 1,424 | 3.22 | |||||||||||||||
ALLL | (1,724 | ) | (1,756 | ) | |||||||||||||||||
Cash and due from banks | 5,405 | 5,127 | |||||||||||||||||||
Other assets | 15,375 | 14,675 | |||||||||||||||||||
Noninterest earning trading assets and derivative instruments | 1,103 | 1,527 | |||||||||||||||||||
Unrealized gains on securities available for sale, net | 512 | 677 | |||||||||||||||||||
Total assets | $203,146 | $198,305 | |||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||
Interest-bearing deposits: | |||||||||||||||||||||
NOW accounts | $42,929 | $17 | 0.16 | % | $41,691 | $13 | 0.12 | % | |||||||||||||
Money market accounts | 54,416 | 30 | 0.22 | 53,186 | 25 | 0.19 | |||||||||||||||
Savings | 6,259 | — | 0.03 | 6,399 | 1 | 0.02 | |||||||||||||||
Consumer time | 5,599 | 10 | 0.69 | 5,984 | 11 | 0.76 | |||||||||||||||
Other time | 3,954 | 10 | 0.97 | 3,881 | 10 | 1.03 | |||||||||||||||
Total interest-bearing consumer and commercial deposits | 113,157 | 67 | 0.23 | 111,141 | 60 | 0.22 | |||||||||||||||
Brokered time deposits | 935 | 3 | 1.28 | 913 | 3 | 1.35 | |||||||||||||||
Foreign deposits | 308 | — | 0.45 | 46 | — | 0.34 | |||||||||||||||
Total interest-bearing deposits | 114,400 | 70 | 0.24 | 112,100 | 63 | 0.23 | |||||||||||||||
Funds purchased | 1,008 | 1 | 0.43 | 1,032 | 1 | 0.36 | |||||||||||||||
Securities sold under agreements to repurchase | 1,708 | 2 | 0.45 | 1,718 | 2 | 0.40 | |||||||||||||||
Interest-bearing trading liabilities | 1,146 | 6 | 2.13 | 1,006 | 6 | 2.39 | |||||||||||||||
Other short-term borrowings | 978 | — | 0.11 | 1,220 | — | 0.20 | |||||||||||||||
Long-term debt | 11,632 | 70 | 2.37 | 10,517 | 64 | 2.46 | |||||||||||||||
Total interest-bearing liabilities | 130,872 | 149 | 0.45 | 127,593 | 136 | 0.43 | |||||||||||||||
Noninterest-bearing deposits | 44,839 | 43,025 | |||||||||||||||||||
Other liabilities | 3,112 | 3,217 | |||||||||||||||||||
Noninterest-bearing trading liabilities and derivative instruments | 279 | 452 | |||||||||||||||||||
Shareholders’ equity | 24,044 | 24,018 | |||||||||||||||||||
Total liabilities and shareholders’ equity | $203,146 | $198,305 | |||||||||||||||||||
Interest Rate Spread | 2.80 | % | 2.79 | % | |||||||||||||||||
Net Interest Income | $1,343 | $1,288 | |||||||||||||||||||
Net Interest Income-FTE 2 | $1,377 | $1,323 | |||||||||||||||||||
Net Interest Margin 3 | 2.93 | % | 2.91 | % | |||||||||||||||||
Net Interest Margin-FTE 2, 3 | 3.00 | 2.99 | |||||||||||||||||||
1 | Interest income includes loan fees of $41 million for both the three months ended December 31, 2016 and June 30, 2016, respectively. |
2 | See Appendix A for additional information and reconcilements of non-U.S. GAAP performance measures. Approximately 95% of the total FTE adjustment for the three months ended December 31, 2016 and June 30, 2016 was attributed to C&I loans. |
3 | Net interest margin is calculated by dividing annualized net interest income by average total earning assets. |
SunTrust Banks, Inc. and Subsidiaries CONSOLIDATED DAILY AVERAGE BALANCES, INCOME/EXPENSE, AND AVERAGE YIELDS EARNED/RATES PAID, continued | |||||||||||||||||||||
Six Months Ended | |||||||||||||||||||||
June 30, 2017 | June 30, 2016 | ||||||||||||||||||||
(Dollars in millions) (Unaudited) | Average Balances | Interest Income/ Expense | Yields/ Rates | Average Balances | Interest Income/ Expense | Yields/ Rates | |||||||||||||||
ASSETS | |||||||||||||||||||||
LHFI: 1 | |||||||||||||||||||||
C&I | $69,099 | $1,128 | 3.29 | % | $68,488 | $1,063 | 3.12 | % | |||||||||||||
CRE | 5,098 | 83 | 3.28 | 6,061 | 88 | 2.91 | |||||||||||||||
Commercial construction | 4,090 | 71 | 3.51 | 2,410 | 39 | 3.26 | |||||||||||||||
Residential mortgages - guaranteed | 550 | 8 | 3.01 | 610 | 12 | 3.89 | |||||||||||||||
Residential mortgages - nonguaranteed | 26,004 | 494 | 3.80 | 25,060 | 476 | 3.80 | |||||||||||||||
Residential home equity products | 11,289 | 235 | 4.19 | 12,657 | 248 | 3.95 | |||||||||||||||
Residential construction | 374 | 8 | 4.12 | 372 | 8 | 4.42 | |||||||||||||||
Consumer student - guaranteed | 6,371 | 136 | 4.31 | 5,252 | 104 | 3.98 | |||||||||||||||
Consumer other direct | 7,934 | 194 | 4.93 | 6,414 | 144 | 4.51 | |||||||||||||||
Consumer indirect | 11,067 | 190 | 3.46 | 10,525 | 177 | 3.38 | |||||||||||||||
Consumer credit cards | 1,380 | 68 | 9.87 | 1,101 | 56 | 10.20 | |||||||||||||||
Nonaccrual | 802 | 13 | 3.16 | 855 | 9 | 2.14 | |||||||||||||||
Total LHFI | 144,058 | 2,628 | 3.68 | 139,805 | 2,424 | 3.49 | |||||||||||||||
Securities available for sale: | |||||||||||||||||||||
Taxable | 30,622 | 373 | 2.44 | 27,537 | 321 | 2.33 | |||||||||||||||
Tax-exempt | 317 | 5 | 3.04 | 151 | 3 | 3.62 | |||||||||||||||
Total securities available for sale | 30,939 | 378 | 2.45 | 27,688 | 324 | 2.34 | |||||||||||||||
Federal funds sold and securities borrowed or purchased under agreements to resell | 1,237 | 3 | 0.51 | 1,231 | 1 | 0.17 | |||||||||||||||
LHFS | 2,415 | 46 | 3.78 | 1,915 | 37 | 3.87 | |||||||||||||||
Interest-bearing deposits in other banks | 25 | — | 0.63 | 23 | — | 0.38 | |||||||||||||||
Interest earning trading assets | 5,159 | 56 | 2.21 | 5,460 | 48 | 1.75 | |||||||||||||||
Total earning assets | 183,833 | 3,111 | 3.41 | 176,122 | 2,834 | 3.24 | |||||||||||||||
ALLL | (1,711 | ) | (1,753 | ) | |||||||||||||||||
Cash and due from banks | 5,227 | 4,571 | |||||||||||||||||||
Other assets | 16,100 | 14,657 | |||||||||||||||||||
Noninterest earning trading assets and derivative instruments | 903 | 1,457 | |||||||||||||||||||
Unrealized gains on securities available for sale, net | 22 | 606 | |||||||||||||||||||
Total assets | $204,374 | $195,660 | |||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||
Interest-bearing deposits: | |||||||||||||||||||||
NOW accounts | $44,590 | $53 | 0.24 | % | $39,842 | $22 | 0.11 | % | |||||||||||||
Money market accounts | 54,549 | 71 | 0.26 | 53,125 | 49 | 0.18 | |||||||||||||||
Savings | 6,527 | 1 | 0.03 | 6,289 | 1 | 0.02 | |||||||||||||||
Consumer time | 5,521 | 19 | 0.70 | 6,044 | 23 | 0.78 | |||||||||||||||
Other time | 4,463 | 22 | 1.01 | 3,847 | 20 | 1.04 | |||||||||||||||
Total interest-bearing consumer and commercial deposits | 115,650 | 166 | 0.29 | 109,147 | 115 | 0.21 | |||||||||||||||
Brokered time deposits | 923 | 6 | 1.28 | 906 | 6 | 1.36 | |||||||||||||||
Foreign deposits | 699 | 3 | 0.81 | 25 | — | 0.34 | |||||||||||||||
Total interest-bearing deposits | 117,272 | 175 | 0.30 | 110,078 | 121 | 0.22 | |||||||||||||||
Funds purchased | 1,014 | 4 | 0.83 | 1,216 | 2 | 0.35 | |||||||||||||||
Securities sold under agreements to repurchase | 1,643 | 6 | 0.74 | 1,768 | 4 | 0.40 | |||||||||||||||
Interest-bearing trading liabilities | 997 | 13 | 2.63 | 1,012 | 12 | 2.48 | |||||||||||||||
Other short-term borrowings | 1,881 | 5 | 0.52 | 1,785 | 3 | 0.28 | |||||||||||||||
Long-term debt | 11,038 | 139 | 2.55 | 9,577 | 123 | 2.58 | |||||||||||||||
Total interest-bearing liabilities | 133,845 | 342 | 0.52 | 125,436 | 265 | 0.42 | |||||||||||||||
Noninterest-bearing deposits | 43,356 | 42,551 | |||||||||||||||||||
Other liabilities | 2,919 | 3,269 | |||||||||||||||||||
Noninterest-bearing trading liabilities and derivative instruments | 348 | 497 | |||||||||||||||||||
Shareholders’ equity | 23,906 | 23,907 | |||||||||||||||||||
Total liabilities and shareholders’ equity | $204,374 | $195,660 | |||||||||||||||||||
Interest Rate Spread | 2.89 | % | 2.82 | % | |||||||||||||||||
Net Interest Income | $2,769 | $2,569 | |||||||||||||||||||
Net Interest Income-FTE 2 | $2,839 | $2,640 | |||||||||||||||||||
Net Interest Margin 3 | 3.04 | % | 2.93 | % | |||||||||||||||||
Net Interest Margin-FTE 2, 3 | 3.11 | 3.01 | |||||||||||||||||||
SunTrust Banks, Inc. and Subsidiaries OTHER FINANCIAL DATA | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||
June 30 | June 30 | ||||||||||||||
(Dollars in millions) (Unaudited) | 2017 | 2016 | 2017 | 2016 | |||||||||||
CREDIT DATA | |||||||||||||||
Allowance for credit losses, beginning of period | $1,783 | $1,831 | $1,776 | $1,815 | |||||||||||
Provision for unfunded commitments | 3 | 5 | 5 | 3 | |||||||||||
Provision/(benefit) for loan losses: | |||||||||||||||
Commercial | 39 | 114 | 84 | 212 | |||||||||||
Residential | (2 | ) | (4 | ) | 4 | (37 | ) | ||||||||
Consumer | 50 | 31 | 116 | 68 | |||||||||||
Total provision for loan losses | 87 | 141 | 204 | 243 | |||||||||||
Charge-offs: | |||||||||||||||
Commercial | (26 | ) | (99 | ) | (89 | ) | (131 | ) | |||||||
Residential | (26 | ) | (33 | ) | (55 | ) | (73 | ) | |||||||
Consumer | (49 | ) | (35 | ) | (104 | ) | (74 | ) | |||||||
Total charge-offs | (101 | ) | (167 | ) | (248 | ) | (278 | ) | |||||||
Recoveries: | |||||||||||||||
Commercial | 7 | 9 | 21 | 19 | |||||||||||
Residential | 11 | 9 | 19 | 15 | |||||||||||
Consumer | 13 | 12 | 26 | 23 | |||||||||||
Total recoveries | 31 | 30 | 66 | 57 | |||||||||||
Net charge-offs | (70 | ) | (137 | ) | (182 | ) | (221 | ) | |||||||
Allowance for credit losses, end of period | $1,803 | $1,840 | $1,803 | $1,840 | |||||||||||
Components: | |||||||||||||||
Allowance for loan and lease losses ("ALLL") | $1,731 | $1,774 | |||||||||||||
Unfunded commitments reserve | 72 | 66 | |||||||||||||
Allowance for credit losses | $1,803 | $1,840 | |||||||||||||
Net charge-offs to average loans held for investment ("LHFI") (annualized): | |||||||||||||||
Commercial | 0.10 | % | 0.46 | % | 0.18 | % | 0.29 | % | |||||||
Residential | 0.16 | 0.24 | 0.19 | 0.30 | |||||||||||
Consumer | 0.54 | 0.39 | 0.59 | 0.44 | |||||||||||
Total net charge-offs to total average LHFI | 0.20 | 0.39 | 0.26 | 0.32 | |||||||||||
Period Ended | |||||||||||||||
Nonaccrual/nonperforming loans ("NPLs"): | |||||||||||||||
Commercial | $325 | $503 | |||||||||||||
Residential | 419 | 433 | |||||||||||||
Consumer | 10 | 8 | |||||||||||||
Total nonaccrual/NPLs | 754 | 944 | |||||||||||||
Other real estate owned (“OREO”) | 61 | 49 | |||||||||||||
Other repossessed assets | 6 | 8 | |||||||||||||
Total nonperforming assets ("NPAs") | $821 | $1,001 | |||||||||||||
Accruing restructured loans | $2,524 | $2,541 | |||||||||||||
Nonaccruing restructured loans | 321 | 307 | |||||||||||||
Accruing LHFI past due > 90 days (guaranteed) | 1,221 | 999 | |||||||||||||
Accruing LHFI past due > 90 days (non-guaranteed) | 30 | 42 | |||||||||||||
Accruing LHFS past due > 90 days | 1 | 1 | |||||||||||||
NPLs to total LHFI | 0.52 | % | 0.67 | % | |||||||||||
NPAs to total LHFI plus OREO and other repossessed assets | 0.57 | 0.71 | |||||||||||||
ALLL to period-end LHFI 1, 2 | 1.20 | 1.25 | |||||||||||||
ALLL to NPLs 1, 2 | 2.31x | 1.89x | |||||||||||||
SunTrust Banks, Inc. and Subsidiaries OTHER FINANCIAL DATA, continued | |||||||||||||||
Three Months Ended | |||||||||||||||
June 30 | March 31 | December 31 | June 30 | ||||||||||||
(Dollars in millions) (Unaudited) | 2017 | 2017 | 2016 | 2016 | |||||||||||
CREDIT DATA | |||||||||||||||
Allowance for credit losses, beginning of period | $1,783 | $1,776 | $1,811 | $1,831 | |||||||||||
Provision/(benefit) for unfunded commitments | 3 | 2 | (1 | ) | 5 | ||||||||||
Provision/(benefit) for loan losses: | |||||||||||||||
Commercial | 39 | 46 | 36 | 114 | |||||||||||
Residential | (2 | ) | 5 | 13 | (4 | ) | |||||||||
Consumer | 50 | 66 | 53 | 31 | |||||||||||
Total provision for loan losses | 87 | 117 | 102 | 141 | |||||||||||
Charge-offs: | |||||||||||||||
Commercial | (26 | ) | (63 | ) | (78 | ) | (99 | ) | |||||||
Residential | (26 | ) | (29 | ) | (34 | ) | (33 | ) | |||||||
Consumer | (49 | ) | (54 | ) | (51 | ) | (35 | ) | |||||||
Total charge-offs | (101 | ) | (146 | ) | (163 | ) | (167 | ) | |||||||
Recoveries: | |||||||||||||||
Commercial | 7 | 13 | 9 | 9 | |||||||||||
Residential | 11 | 9 | 8 | 9 | |||||||||||
Consumer | 13 | 12 | 10 | 12 | |||||||||||
Total recoveries | 31 | 34 | 27 | 30 | |||||||||||
Net charge-offs | (70 | ) | (112 | ) | (136 | ) | (137 | ) | |||||||
Allowance for credit losses, end of period | $1,803 | $1,783 | $1,776 | $1,840 | |||||||||||
Components: | |||||||||||||||
ALLL | $1,731 | $1,714 | $1,709 | $1,774 | |||||||||||
Unfunded commitments reserve | 72 | 69 | 67 | 66 | |||||||||||
Allowance for credit losses | $1,803 | $1,783 | $1,776 | $1,840 | |||||||||||
Net charge-offs to average LHFI (annualized): | |||||||||||||||
Commercial | 0.10 | % | 0.26 | % | 0.35 | % | 0.46 | % | |||||||
Residential | 0.16 | 0.22 | 0.26 | 0.24 | |||||||||||
Consumer | 0.54 | 0.64 | 0.64 | 0.39 | |||||||||||
Total net charge-offs to total average LHFI | 0.20 | 0.32 | 0.38 | 0.39 | |||||||||||
Period Ended | |||||||||||||||
Nonaccrual/NPLs: | |||||||||||||||
Commercial | $325 | $352 | $414 | $503 | |||||||||||
Residential | 419 | 428 | 424 | 433 | |||||||||||
Consumer | 10 | 9 | 7 | 8 | |||||||||||
Total nonaccrual/NPLs | 754 | 789 | 845 | 944 | |||||||||||
OREO | 61 | 62 | 60 | 49 | |||||||||||
Other repossessed assets | 6 | 7 | 14 | 8 | |||||||||||
Total NPAs | $821 | $858 | $919 | $1,001 | |||||||||||
Accruing restructured loans | $2,524 | $2,545 | $2,535 | $2,541 | |||||||||||
Nonaccruing restructured loans | 321 | 329 | 306 | 307 | |||||||||||
Accruing LHFI past due > 90 days (guaranteed) | 1,221 | 1,190 | 1,254 | 999 | |||||||||||
Accruing LHFI past due > 90 days (non-guaranteed) | 30 | 37 | 34 | 42 | |||||||||||
Accruing LHFS past due > 90 days | 1 | 1 | 1 | 1 | |||||||||||
NPLs to total LHFI | 0.52 | % | 0.55 | % | 0.59 | % | 0.67 | % | |||||||
NPAs to total LHFI plus OREO and other repossessed assets | 0.57 | 0.60 | 0.64 | 0.71 | |||||||||||
ALLL to period-end LHFI 1, 2 | 1.20 | 1.20 | 1.19 | 1.25 | |||||||||||
ALLL to NPLs 1, 2 | 2.31x | 2.18x | 2.03x | 1.89x | |||||||||||
SunTrust Banks, Inc. and Subsidiaries OTHER FINANCIAL DATA, continued | |||||||||||||||||||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||||||||||
(Dollars in millions) (Unaudited) | MSRs - Fair Value | Other | Total | MSRs - Fair Value | Other | Total | |||||||||||||||||
OTHER INTANGIBLE ASSETS ROLLFORWARD | |||||||||||||||||||||||
Balance, beginning of period | $1,182 | $16 | $1,198 | $1,307 | $18 | $1,325 | |||||||||||||||||
Amortization | — | (2 | ) | (2 | ) | — | (4 | ) | (4 | ) | |||||||||||||
Servicing rights originated | 64 | — | 64 | 110 | — | 110 | |||||||||||||||||
Servicing rights purchased | — | — | — | 77 | — | 77 | |||||||||||||||||
Fair value changes due to inputs and assumptions 1 | (129 | ) | — | (129 | ) | (333 | ) | — | (333 | ) | |||||||||||||
Other changes in fair value 2 | (56 | ) | — | (56 | ) | (99 | ) | — | (99 | ) | |||||||||||||
Servicing rights sold | — | — | — | (1 | ) | — | (1 | ) | |||||||||||||||
Balance, June 30, 2016 | $1,061 | $14 | $1,075 | $1,061 | $14 | $1,075 | |||||||||||||||||
Balance, beginning of period | $1,645 | $84 | $1,729 | $1,572 | $85 | $1,657 | |||||||||||||||||
Amortization | — | (5 | ) | (5 | ) | — | (10 | ) | (10 | ) | |||||||||||||
Servicing rights originated | 65 | 2 | 67 | 162 | 7 | 169 | |||||||||||||||||
Fair value changes due to inputs and assumptions 1 | (43 | ) | — | (43 | ) | (16 | ) | — | (16 | ) | |||||||||||||
Other changes in fair value 2 | (58 | ) | — | (58 | ) | (109 | ) | — | (109 | ) | |||||||||||||
Servicing rights sold | (1 | ) | — | (1 | ) | (1 | ) | — | (1 | ) | |||||||||||||
Other 3 | — | — | — | — | (1 | ) | (1 | ) | |||||||||||||||
Balance, June 30, 2017 | $1,608 | $81 | $1,689 | $1,608 | $81 | $1,689 |
SunTrust Banks, Inc. and Subsidiaries APPENDIX A TO THE EARNINGS RELEASE - RECONCILEMENT OF NON-U.S. GAAP MEASURES 1 | |||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
June 30 | March 31 | December 31 | June 30 | June 30 | |||||||||||||||||||
(Dollars in millions) (Unaudited) | 2017 | 2017 | 2016 | 2016 | 2017 | 2016 | |||||||||||||||||
Net interest income | $1,403 | $1,366 | $1,343 | $1,288 | $2,769 | $2,569 | |||||||||||||||||
Fully taxable-equivalent ("FTE") adjustment | 36 | 34 | 34 | 35 | 70 | 71 | |||||||||||||||||
Net interest income-FTE 2 | 1,439 | 1,400 | 1,377 | 1,323 | 2,839 | 2,640 | |||||||||||||||||
Noninterest income | 827 | 847 | 815 | 898 | 1,674 | 1,680 | |||||||||||||||||
Total revenue-FTE 2 | $2,266 | $2,247 | $2,192 | $2,221 | $4,513 | $4,320 | |||||||||||||||||
Return on average common shareholders’ equity | 9.08 | % | 8.19 | % | 7.85 | % | 8.43 | % | 8.64 | % | 8.07 | % | |||||||||||
Impact of removing average intangible assets and related pre-tax amortization, other than MSRs and other servicing rights | 3.43 | 3.09 | 2.91 | 3.11 | 3.26 | 3.00 | |||||||||||||||||
Return on average tangible common shareholders' equity 3 | 12.51 | % | 11.28 | % | 10.76 | % | 11.54 | % | 11.90 | % | 11.07 | % | |||||||||||
Net interest margin | 3.06 | % | 3.02 | % | 2.93 | % | 2.91 | % | 3.04 | % | 2.93 | % | |||||||||||
Impact of FTE adjustment | 0.08 | 0.07 | 0.07 | 0.08 | 0.07 | 0.08 | |||||||||||||||||
Net interest margin-FTE 2 | 3.14 | % | 3.09 | % | 3.00 | % | 2.99 | % | 3.11 | % | 3.01 | % | |||||||||||
Noninterest expense | $1,388 | $1,465 | $1,397 | $1,345 | $2,853 | $2,663 | |||||||||||||||||
Total revenue | 2,230 | 2,213 | 2,158 | 2,186 | 4,443 | 4,249 | |||||||||||||||||
Efficiency ratio 4 | 62.24 | % | 66.20 | % | 64.74 | % | 61.53 | % | 64.21 | % | 62.67 | % | |||||||||||
Impact of FTE adjustment | (1.00 | ) | (1.01 | ) | (1.01 | ) | (0.97 | ) | (1.00 | ) | (1.02 | ) | |||||||||||
Efficiency ratio-FTE 2, 4 | 61.24 | 65.19 | 63.73 | 60.56 | 63.21 | 61.65 | |||||||||||||||||
Impact of excluding amortization related to intangible assets and certain tax credits | (0.65 | ) | (0.59 | ) | (0.65 | ) | (0.51 | ) | (0.62 | ) | (0.49 | ) | |||||||||||
Tangible efficiency ratio-FTE 2, 5 | 60.59 | % | 64.60 | % | 63.08 | % | 60.05 | % | 62.59 | % | 61.16 | % | |||||||||||
Basel III Common Equity Tier 1 ("CET1") ratio (transitional) 6 | 9.68 | % | 9.69 | % | 9.59 | % | 9.84 | % | |||||||||||||||
Impact of MSRs and other under fully phased-in approach | (0.15 | ) | (0.15 | ) | (0.16 | ) | (0.11 | ) | |||||||||||||||
Basel III fully phased-in CET1 ratio 6 | 9.53 | % | 9.54 | % | 9.43 | % | 9.73 | % | |||||||||||||||
SunTrust Banks, Inc. and Subsidiaries APPENDIX A TO THE EARNINGS RELEASE - RECONCILEMENT OF NON-U.S. GAAP MEASURES, continued 1 | |||||||||||||||
June 30 | March 31 | December 31 | June 30 | ||||||||||||
(Dollars in millions, except per share data) (Unaudited) | 2017 | 2017 | 2016 | 2016 | |||||||||||
Total shareholders' equity | $24,477 | $23,484 | $23,618 | $24,464 | |||||||||||
Goodwill, net of deferred taxes of $253 million, $252 million, $251 million, and $246 million, respectively | (6,085 | ) | (6,086 | ) | (6,086 | ) | (6,091 | ) | |||||||
Other intangible assets (including MSRs and other servicing rights) | (1,689 | ) | (1,729 | ) | (1,657 | ) | (1,075 | ) | |||||||
MSRs and other servicing rights | 1,671 | 1,711 | 1,638 | 1,067 | |||||||||||
Tangible equity 2 | 18,374 | 17,380 | 17,513 | 18,365 | |||||||||||
Noncontrolling interest | (103 | ) | (101 | ) | (103 | ) | (103 | ) | |||||||
Preferred stock | (1,975 | ) | (1,225 | ) | (1,225 | ) | (1,225 | ) | |||||||
Tangible common equity 2 | $16,296 | $16,054 | $16,185 | $17,037 | |||||||||||
Total assets | $207,223 | $205,642 | $204,875 | $198,892 | |||||||||||
Goodwill | (6,338 | ) | (6,338 | ) | (6,337 | ) | (6,337 | ) | |||||||
Other intangible assets (including MSRs and other servicing rights) | (1,689 | ) | (1,729 | ) | (1,657 | ) | (1,075 | ) | |||||||
MSRs and other servicing rights | 1,671 | 1,711 | 1,638 | 1,067 | |||||||||||
Tangible assets | $200,867 | $199,286 | $198,519 | $192,547 | |||||||||||
Tangible equity to tangible assets 2 | 9.15 | % | 8.72 | % | 8.82 | % | 9.54 | % | |||||||
Tangible common equity to tangible assets 2 | 8.11 | 8.06 | 8.15 | 8.85 | |||||||||||
Tangible book value per common share 3 | $33.83 | $33.05 | $32.95 | $33.98 | |||||||||||
SunTrust Banks, Inc. and Subsidiaries CONSUMER BUSINESS SEGMENT 1 | |||||||||||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||
(Dollars in millions) (Unaudited) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Statements of Income: | |||||||||||||||
Net interest income | $910 | $849 | $1,793 | $1,692 | |||||||||||
FTE adjustment | — | — | — | — | |||||||||||
Net interest income-FTE 2 | 910 | 849 | 1,793 | 1,692 | |||||||||||
Provision for credit losses 3 | 75 | 43 | 163 | 61 | |||||||||||
Net interest income-FTE - after provision for credit losses 2 | 835 | 806 | 1,630 | 1,631 | |||||||||||
Noninterest income before net securities gains | 465 | 532 | 928 | 1,013 | |||||||||||
Net securities gains | — | — | — | — | |||||||||||
Total noninterest income | 465 | 532 | 928 | 1,013 | |||||||||||
Noninterest expense before amortization | 945 | 932 | 1,932 | 1,849 | |||||||||||
Amortization | 1 | 1 | 1 | 1 | |||||||||||
Total noninterest expense | 946 | 933 | 1,933 | 1,850 | |||||||||||
Income-FTE - before provision for income taxes 2 | 354 | 405 | 625 | 794 | |||||||||||
Provision for income taxes | 127 | 152 | 224 | 297 | |||||||||||
Tax credit adjustment | — | — | — | — | |||||||||||
FTE adjustment | — | — | — | — | |||||||||||
Net income including income attributable to noncontrolling interest | 227 | 253 | 401 | 497 | |||||||||||
Less: net income attributable to noncontrolling interest | — | — | — | — | |||||||||||
Net income | $227 | $253 | $401 | $497 | |||||||||||
Total revenue | $1,375 | $1,381 | $2,721 | $2,705 | |||||||||||
Total revenue-FTE 2 | 1,375 | 1,381 | 2,721 | 2,705 | |||||||||||
Selected Average Balances: | |||||||||||||||
Total LHFI | $72,088 | $69,170 | $71,658 | $68,391 | |||||||||||
Goodwill | 4,262 | 4,262 | 4,262 | 4,262 | |||||||||||
Other intangible assets excluding MSRs | 8 | 14 | 9 | 15 | |||||||||||
Total assets | 81,803 | 78,387 | 81,574 | 77,476 | |||||||||||
Consumer and commercial deposits | 103,145 | 100,482 | 102,488 | 98,265 | |||||||||||
Performance Ratios: | |||||||||||||||
Efficiency ratio | 68.80 | % | 67.63 | % | 71.02 | % | 68.37 | % | |||||||
Impact of FTE adjustment | — | — | — | — | |||||||||||
Efficiency ratio-FTE 2 | 68.80 | 67.63 | 71.02 | 68.37 | |||||||||||
Impact of excluding amortization and associated funding cost of intangible assets | (1.14 | ) | (1.09 | ) | (1.17 | ) | (1.14 | ) | |||||||
Tangible efficiency ratio-FTE 2, 4 | 67.66 | % | 66.54 | % | 69.85 | % | 67.23 | % | |||||||
Mortgage Production Data: | |||||||||||||||
Channel mix | |||||||||||||||
Retail | $2,692 | $3,404 | $4,984 | $5,655 | |||||||||||
Correspondent | 3,733 | 3,879 | 6,932 | 6,580 | |||||||||||
Total production | $6,425 | $7,283 | $11,916 | $12,235 | |||||||||||
Channel mix - percent | |||||||||||||||
Retail | 42 | % | 47 | % | 42 | % | 46 | % | |||||||
Correspondent | 58 | 53 | 58 | 54 | |||||||||||
Total production | 100 | % | 100 | % | 100 | % | 100 | % | |||||||
Purchase and refinance mix | |||||||||||||||
Refinance | $1,962 | $3,269 | $4,493 | $5,881 | |||||||||||
Purchase | 4,463 | 4,014 | 7,423 | 6,354 | |||||||||||
Total production | $6,425 | $7,283 | $11,916 | $12,235 | |||||||||||
Purchase and refinance mix - percent | |||||||||||||||
Refinance | 31 | % | 45 | % | 38 | % | 48 | % | |||||||
Purchase | 69 | 55 | 62 | 52 | |||||||||||
Total production | 100 | % | 100 | % | 100 | % | 100 | % | |||||||
Applications | $8,273 | $11,225 | $16,017 | $20,430 | |||||||||||
Mortgage Servicing Data (End of Period): | |||||||||||||||
Total loans serviced | $165,601 | $154,474 | |||||||||||||
Total loans serviced for others | 136,115 | 125,408 | |||||||||||||
Net carrying value of MSRs | 1,608 | 1,061 | |||||||||||||
Ratio of net carrying value of MSRs to total loans serviced for others | 1.181 | % | 0.846 | % |
Assets Under Administration (End of Period): | |||||||||||||||
Trust and institutional managed assets | $41,572 | $40,541 | |||||||||||||
Retail brokerage managed assets | 14,826 | 11,751 | |||||||||||||
Total managed assets | 56,398 | 52,292 | |||||||||||||
Non-managed assets | 95,463 | 92,917 | |||||||||||||
Total assets under advisement | $151,861 | $145,209 |
1 | Beginning in the second quarter of 2017, the Company realigned its business segment structure from three segments to two segments based on, among other things, the manner in which financial information is evaluated by management and in conjunction with Company-wide organizational changes that were announced during the first quarter of 2017. Specifically, the Company retained the previous composition of the Wholesale Banking segment and changed the basis of presentation of the Consumer Banking and Private Wealth Management segment and Mortgage Banking segment such that those segments were combined into a single Consumer segment. Accordingly, prior period information has been revised to conform to the new business segment structure and updated internal funds transfer pricing methodology for consistent presentation. |
2 | Net interest income-FTE, income-FTE, total revenue-FTE, efficiency ratio-FTE, and tangible efficiency ratio-FTE are presented on a fully taxable-equivalent (“FTE”) basis. The FTE basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. Total revenue-FTE equals net interest income on an FTE basis plus noninterest income. |
3 | Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the allowance for loan and lease losses and unfunded commitment reserve balances. |
4 | A tangible efficiency ratio is presented, which excludes the amortization related to intangible assets and certain tax credits. The Company believes this measure is useful to investors because, by removing the impact of amortization (the level of which may vary from company to company), it allows investors to more easily compare this segment's efficiency to other business segments and companies in the industry. This measure is utilized by management to assess the efficiency of the Company and its lines of business. |
SunTrust Banks, Inc. and Subsidiaries WHOLESALE BUSINESS SEGMENT | |||||||||||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||
(Dollars in millions) (Unaudited) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Statements of Income: | |||||||||||||||
Net interest income | $555 | $486 | $1,095 | $978 | |||||||||||
FTE adjustment | 35 | 34 | 69 | 69 | |||||||||||
Net interest income-FTE 1 | 590 | 520 | 1,164 | 1,047 | |||||||||||
Provision for credit losses 2 | 15 | 103 | 47 | 186 | |||||||||||
Net interest income-FTE - after provision for credit losses 1 | 575 | 417 | 1,117 | 861 | |||||||||||
Noninterest income before net securities gains | 386 | 329 | 788 | 640 | |||||||||||
Net securities gains | — | — | — | — | |||||||||||
Total noninterest income | 386 | 329 | 788 | 640 | |||||||||||
Noninterest expense before amortization | 443 | 404 | 914 | 801 | |||||||||||
Amortization | 14 | 11 | 27 | 20 | |||||||||||
Total noninterest expense | 457 | 415 | 941 | 821 | |||||||||||
Income-FTE - before provision for income taxes 1 | 504 | 331 | 964 | 680 | |||||||||||
Provision for income taxes | 116 | 60 | 216 | 128 | |||||||||||
Tax credit adjustment | 36 | 29 | 73 | 57 | |||||||||||
FTE adjustment | 35 | 34 | 69 | 69 | |||||||||||
Net income including income attributable to noncontrolling interest | 317 | 208 | 606 | 426 | |||||||||||
Less: net income attributable to noncontrolling interest | — | — | — | — | |||||||||||
Net income | $317 | $208 | $606 | $426 | |||||||||||
Total revenue | $941 | $815 | $1,883 | $1,618 | |||||||||||
Total revenue-FTE 1 | 976 | 849 | 1,952 | 1,687 | |||||||||||
Selected Average Balances: | |||||||||||||||
Total LHFI | $72,278 | $72,010 | $72,329 | $71,353 | |||||||||||
Goodwill | 2,076 | 2,075 | 2,076 | 2,075 | |||||||||||
Other intangible assets excluding MSRs | 75 | 1 | 75 | 1 | |||||||||||
Total assets | 85,735 | 85,988 | 85,764 | 85,137 | |||||||||||
Consumer and commercial deposits | 55,801 | 53,651 | 56,389 | 53,386 | |||||||||||
Performance Ratios: | |||||||||||||||
Efficiency ratio | 48.58 | % | 50.82 | % | 49.93 | % | 50.75 | % | |||||||
Impact of FTE adjustment | (1.76 | ) | (2.06 | ) | (1.76 | ) | (2.08 | ) | |||||||
Efficiency ratio-FTE 1 | 46.82 | 48.76 | 48.17 | 48.67 | |||||||||||
Impact of excluding amortization and associated funding cost of intangible assets | (1.96 | ) | (1.84 | ) | (1.90 | ) | (1.79 | ) | |||||||
Tangible efficiency ratio-FTE 1, 3 | 44.86 | % | 46.92 | % | 46.27 | % | 46.88 | % | |||||||
1 | Net interest income-FTE, income-FTE, total revenue-FTE, efficiency ratio-FTE, and tangible efficiency ratio-FTE are presented on a fully taxable-equivalent (“FTE”) basis. The FTE basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. Total revenue-FTE equals net interest income on an FTE basis plus noninterest income. |
2 | Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the allowance for loan and lease losses and unfunded commitment reserve balances. |
3 | A tangible efficiency ratio is presented, which excludes the amortization related to intangible assets and certain tax credits. The Company believes this measure is useful to investors because, by removing the impact of amortization (the level of which may vary from company to company), it allows investors to more easily compare this segment's efficiency to other business segments and companies in the industry. This measure is utilized by management to assess the efficiency of the Company and its lines of business. |
SunTrust Banks, Inc. and Subsidiaries CORPORATE OTHER | |||||||||||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||
(Dollars in millions) (Unaudited) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Statements of Income: | |||||||||||||||
Net interest income/(expense) 1 | ($62 | ) | ($47 | ) | ($119 | ) | ($101 | ) | |||||||
FTE adjustment | 1 | 1 | 1 | 2 | |||||||||||
Net interest income/(expense)-FTE 2 | (61 | ) | (46 | ) | (118 | ) | (99 | ) | |||||||
Provision/(benefit) for credit losses 3 | — | — | (1 | ) | (1 | ) | |||||||||
Net interest income/(expense)-FTE - after provision/(benefit) for credit losses 2 | (61 | ) | (46 | ) | (117 | ) | (98 | ) | |||||||
Noninterest income/(expense) before net securities gains | (25 | ) | 33 | (43 | ) | 23 | |||||||||
Net securities gains | 1 | 4 | 1 | 4 | |||||||||||
Total noninterest income/(expense) | (24 | ) | 37 | (42 | ) | 27 | |||||||||
Noninterest expense/(income) before amortization | (15 | ) | (2 | ) | (21 | ) | (8 | ) | |||||||
Amortization | — | (1 | ) | — | — | ||||||||||
Total noninterest expense/(income) | (15 | ) | (3 | ) | (21 | ) | (8 | ) | |||||||
Income/(loss)-FTE - before benefit for income taxes 2 | (70 | ) | (6 | ) | (138 | ) | (63 | ) | |||||||
Benefit for income taxes | (21 | ) | (11 | ) | (59 | ) | (29 | ) | |||||||
Tax credit adjustment | (36 | ) | (29 | ) | (73 | ) | (57 | ) | |||||||
FTE adjustment | 1 | 1 | 1 | 2 | |||||||||||
Net income/(loss) including income attributable to noncontrolling interest | (14 | ) | 33 | (7 | ) | 21 | |||||||||
Less: net income attributable to noncontrolling interest | 2 | 2 | 5 | 5 | |||||||||||
Net income/(loss) | ($16 | ) | $31 | ($12 | ) | $16 | |||||||||
Total revenue | ($86 | ) | ($10 | ) | ($161 | ) | ($74 | ) | |||||||
Total revenue-FTE 2 | (85 | ) | (9 | ) | (160 | ) | (72 | ) | |||||||
Selected Average Balances: | |||||||||||||||
Total LHFI | $74 | $58 | $71 | $61 | |||||||||||
Securities available for sale | 30,967 | 28,021 | 30,902 | 27,647 | |||||||||||
Goodwill | — | — | — | — | |||||||||||
Other intangible assets excluding MSRs | — | — | — | — | |||||||||||
Total assets | 36,956 | 33,930 | 37,036 | 33,047 | |||||||||||
Consumer and commercial deposits | 190 | 33 | 129 | 47 | |||||||||||
Other Information (End of Period): | |||||||||||||||
Duration of investment portfolio (in years) | 4.5 | 4.1 | |||||||||||||
Net interest income interest rate sensitivity: | |||||||||||||||
% Change in net interest income under: | |||||||||||||||
Instantaneous 200 basis point increase in rates over next 12 months | 3.7 | % | 4.2 | % | |||||||||||
Instantaneous 100 basis point increase in rates over next 12 months | 2.1 | % | 2.3 | % | |||||||||||
Instantaneous 25 basis point decrease in rates over next 12 months | (0.7 | )% | (0.7 | )% | |||||||||||
1 | Net interest income/(expense) is driven by matched funds transfer pricing applied for segment reporting and actual net interest income. |
2 | Net interest income/(expense)-FTE, income/(loss)-FTE, and total revenue-FTE are presented on a fully taxable-equivalent (“FTE”) basis. The FTE basis adjusts for the tax-favored status of net interest income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. Total revenue-FTE equals net interest income on an FTE basis plus noninterest income. |
3 | Provision/(benefit) for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision/(benefit) attributable to quarterly changes in the allowance for loan and lease losses and unfunded commitments reserve balances. |