WINSTON-SALEM, N.C., Oct. 27 /PRNewswire-FirstCall/ -- BB&T Corporation
(NYSE: BBT) said today that it has received preliminary approval to
participate in the U.S. Treasury Department's capital purchase program to
revive the financial sector. BB&T, one of the strongest capitalized
financial institutions in the U.S., will receive $3.1 billion from a
government capital infusion plan aimed at restoring liquidity and easing
credit in the financial markets.
In exchange for its investment, the U.S. Treasury will receive shares
of BB&T preferred stock at a 5 percent annual dividend rate for the first
five years. BB&T will pay the government a 9 percent dividend in years six
through 10 if shares are not redeemed. The U.S. Treasury will also receive
10-year warrants to purchase shares of BB&T common stock.
BB&T's Tier 1 capital ratio, a measure of financial strength and
soundness, will increase to 12.4 percent from 9.4 percent, significantly
higher than the government's safety threshold of 6 percent. BB&T's total
capital ratio will improve to 17.4 percent from 14.4 percent, notably
higher than the minimum government ratio of 10 percent.
"We support the Treasury's efforts to stabilize the credit markets and
restore confidence in the financial system," said BB&T Chairman and CEO
John A. Allison. "Fortunately, our own strong capital position has allowed
us to meet the lending needs of our clients, even during this economic
downturn. For us, the additional capital will not only extend and
strengthen our lending capacity, but provide other strategic options as
well."
With $137 billion in assets, BB&T Corporation is the nation's 14th
largest financial holding company. It operates 1,501 financial centers in
11 states and Washington, D.C. More information about the company is
available at http://www.BBT.com .
SOURCE BB&T Corporation
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Related links:
http://www.bbt.com
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CONTACT:
Tamara Gjesdal, Senior Vice President,
Investor Relations, +1-336-733-3058, Chris Henson, Sr. Exec. Vice
President, Chief Financial Officer, +1-336-733-3008, Bob Denham,
Senior Vice President, Corporate Communications, +1-336-733-1475,
all of BB&T Corporation
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