SunTrust Reports First Quarter 2011 Results
Continued Improvement in Operating Trends; Redemption of TARP Shares Completed
ATLANTA, April 21, 2011 /PRNewswire/ -- SunTrust Banks, Inc. (NYSE: STI) today reported net income per average common share of $0.08 for the first quarter of 2011, or $0.22 excluding the $0.14 non-cash charge related to the redemption of the TARP preferred shares issued to the U.S. Treasury under the Capital Purchase Program. Excluding this charge, earnings were essentially flat compared to the $0.23 per share reported in the fourth quarter of 2010. This quarter's performance was driven by further improvement in credit quality, expansion of the net interest margin and a reduction in expenses. These results were achieved despite seasonal and cyclical factors adversely impacting first quarter results. Results compare favorably to a net loss of $0.46 per average common share reported for the first quarter of 2010. Net income available to common shareholders was $38 million for the first quarter of 2011, or $112 million excluding the $74 million non-cash charge related to the redemption of the TARP preferred shares.
"Our emphasis on profitable growth and continued credit quality improvement resulted in solid performance that was in line with our expectations for the quarter," said James M. Wells III, chairman and chief executive officer of SunTrust Banks, Inc. Mr. Wells noted that the Company's patient and deliberate approach to TARP redemption had been completed with the best interests of shareholders in mind, and that SunTrust is now "singularly focused on client-centric strategies to take advantage of the growth opportunities in our markets and further improve profitability."
First Quarter 2011 Financial Highlights
Income Statement
- Net income available to common shareholders, excluding the impact from the redemption of TARP preferred shares, was $0.22 per share compared to earnings of $0.23 per share in the prior quarter and a loss of $0.46 per share in the first quarter of 2010.
- Net interest income was up 6% from the prior year and down 1% from the prior quarter. The growth from the prior year was due primarily to lower funding costs resulting from strong low-cost deposit growth, while the decline from the prior quarter was due to fewer business days in the current quarter.
- Net interest margin increased from the prior quarter by 9 basis points to 3.53%, continuing the upward quarterly trend experienced in each of the past eight quarters.
- Noninterest income declined from the prior quarter, as expected, due to lower mortgage production and cyclical capital markets fees. Noninterest income increased from the prior year due to widespread growth in consumer and commercial categories.
- Noninterest expense declined compared to the prior quarter, despite seasonally higher employee benefits costs, as credit-related, marketing, and technology expenses decreased. Expenses increased from the prior year primarily due to compensation expenses associated with improved business performance and an increase in full-time equivalent employees.
Credit Quality
- Credit quality continued to improve with net charge-offs, nonperforming loans, nonperforming assets, and early stage delinquencies all declining.
- Provision for credit losses declined due to lower net charge-offs and the impact of improved credit quality on the allowance for loan losses. The allowance for loan losses was $2.9 billion, or 2.49% of total loans, down 9 basis points from year end.
Balance Sheet
- Average loans were relatively flat compared to the prior quarter; however, commercial & industrial and consumer loans grew modestly, while the higher-risk segments of the portfolio continued to decline.
- Average customer deposits grew to a record level, and the favorable trend in the deposit mix toward lower-cost accounts continued.
- SunTrust's capital position was further strengthened this quarter by the $1 billion common equity offering in conjunction with the redemption of TARP preferred shares. The Tier 1 common ratio is well above the recent Basel III proposed guidance and is estimated at 9.00%. The estimated Tier 1 capital and total capital ratios were 11.00% and 13.90% at quarter end, which were also well in excess of current and proposed regulatory guidelines to be considered "well capitalized."
1Q 2010 |
4Q 2010 |
1Q 2011 |
|||
Income Statement |
|||||
(Presented on a fully taxable equivalent basis) (Dollars in millions, except per share data) |
|||||
Net income/(loss) |
$(161) |
$185 |
$180 |
||
Net income/(loss) available to common shareholders |
(229) |
114 |
38 |
||
Earnings per average common diluted share |
(0.46) |
0.23 |
0.08 |
||
Earnings per average common diluted share excluding impact of TARP redemption |
(0.46) |
0.23 |
0.22 |
||
Total revenue |
1,900 |
2,326 |
2,160 |
||
Total revenue, excluding net securities gains/losses |
1,899 |
2,262 |
2,096 |
||
Net interest income |
1,202 |
1,294 |
1,277 |
||
Provision for credit losses |
862 |
512 |
447 |
||
Noninterest income |
698 |
1,032 |
883 |
||
Noninterest expense |
1,361 |
1,548 |
1,465 |
||
Net interest margin |
3.32% |
3.44% |
3.53% |
||
Balance Sheet |
|||||
(Dollars in billions) |
|||||
Average loans |
$114.4 |
$114.9 |
$115.2 |
||
Average consumer and commercial deposits |
115.1 |
119.7 |
120.7 |
||
Capital |
|||||
Tier 1 capital ratio (1) |
13.13% |
13.67% |
11.00% |
||
Tier 1 common equity ratio (1) |
7.70% |
8.08% |
9.00% |
||
Total average shareholders' equity to total average assets |
13.03% |
13.49% |
13.35% |
||
Asset Quality |
|||||
Net charge-offs to average loans (annualized) |
2.91% |
2.14% |
2.01% |
||
Allowance for loan losses to period end loans |
2.80% |
2.58% |
2.49% |
||
Nonperforming loans to total loans |
4.55% |
3.54% |
3.46% |
||
(1) Current period Tier 1 capital and Tier 1 common equity ratios are estimated as of the earnings release date. |
|||||
Consolidated Financial Performance
(Presented on a fully taxable-equivalent basis unless otherwise noted)
Revenue
Total revenue was $2,160 million for the first quarter of 2011 compared with $2,326 million in the fourth quarter of 2010 and $1,900 million for the first quarter of 2010. The 7% decline on a sequential quarter basis was primarily in noninterest income and due to lower mortgage production, declines in investment banking, and reduced mark-to-market valuation gains on the Company's debt carried at fair value, net of related hedges. The 14% total revenue increase from the prior year was driven by reduced interest expense, due primarily to strong low-cost deposit growth, and broad-based increases in consumer and commercial fee categories. Both the current quarter and the fourth quarter of 2010 included net gains of $64 million from the sales of securities compared with net gains of $1 million in the first quarter of 2010.
Net Interest Income
For the first quarter of 2011, net interest income was $1,277 million compared with $1,294 million in the prior quarter and $1,202 million in the prior year. The $17 million, or 1%, decline on a sequential quarter basis was primarily related to two fewer days in the current quarter. The 6% increase in net interest income over the first quarter of 2010 was attributable to lower deposit rates, continued deposit growth, and the shift in deposit mix toward low-cost deposits, thereby enabling a decline in higher-cost wholesale funding. Interest earning asset yields were relatively stable, despite the lower interest rate environment, due to active management of the balance sheet and improved loan pricing.
Net interest margin for the first quarter of 2011 was 3.53% compared with 3.44% in the prior quarter and 3.32% in the prior year. The 9 basis point increase on a sequential quarter basis was driven by higher rates on average earning assets, primarily related to a reduction in lower-yielding securities available for sale, and favorable changes in deposit mix. Compared to the first quarter of 2010, the 21 basis point increase was primarily driven by a 31 basis point decline in rates paid on interest-bearing liabilities, which more than offset a 6 basis point decline in earning asset yields.
Noninterest Income
Total noninterest income was $883 million in the first quarter of 2011 compared with $1,032 million in the prior quarter and $698 million in the prior year. The $149 million, or 14%, sequential quarter decline was primarily driven by lower mortgage production related income, investment banking revenue, and mark-to-market valuation gains. Compared with the first quarter of 2010, noninterest income increased $185 million, or 27%, due to broad-based growth in consumer and commercial fee-based categories and higher net gains on the sale of investment securities, partially offset by lower service charges on deposit accounts.
Mortgage production and servicing income was a combined $71 million in the current quarter compared with $109 million in the prior quarter and $39 million in the prior year. The $38 million, or 35%, decline on a sequential quarter basis was due to lower mortgage production volume in light of the negative impact that higher mortgage interest rates had on refinance activity, as well as reduced gain on sale margins. The $32 million increase in mortgage income from the prior year was primarily due to a $48 million decline in mortgage repurchase costs. The repurchase cost was $80 million in the current quarter, and reserves for mortgage repurchase losses were $270 million as of March 31, 2011, an increase of $5 million over December 31, 2010. The reserve increase was primarily due to recent increases in agency-related repurchase requests. Mortgage servicing income was essentially flat compared to the prior quarter and prior year. The mortgage servicing portfolio was $164.4 billion as of March 31, 2011, compared to $167.2 billion at December 31, 2010.
Trading account profits and commissions were $52 million in the first quarter of 2011 compared with $93 million in the prior quarter and ($7) million in the prior year. Core capital markets-related trading income remained stable on a sequential quarter basis and was up slightly year-over-year. The $41 million sequential quarter decline was driven by $31 million in valuation related losses, net of hedges, on the Company's index-linked CDs and public debt, both carried at fair value. This compares with valuation gains of $21 million in the fourth quarter of 2010. The net $52 million change was the result of the Company's credit spread improving during the current quarter. Partially offsetting these debt-related mark-to-market losses was an incremental $11 million in valuation gains on illiquid securities. Compared to the first quarter of 2010, trading account profits and commissions increased $59 million driven by a $20 million decrease in valuation losses, net of hedges, on the Company's index-linked CDs and public debt, both carried at fair value, as well as more favorable valuation impacts of approximately $46 million on illiquid securities.
Investment banking income was $67 million in the current quarter compared with $103 million in the fourth quarter of 2010 and $56 million in the first quarter of 2010. The $36 million sequential quarter decline was attributable to high levels of syndicated finance deal flow in the fourth quarter and a typical seasonal decline in investment banking during the first quarter. The $11 million increase from the prior year was due to higher levels of syndicated finance income.
Service charges on deposit accounts declined on a year-over-year and sequential quarter basis, primarily due to overdraft fees, as clients altered their behavior, including responding to regulatory-induced product changes. Conversely, trust income, retail investment income, and card fees all increased on both a sequential quarter and prior year comparison. Net gains on the sale of securities associated with repositioning the investment portfolio were $64 million in the current quarter and the fourth quarter of 2010 and $1 million in the first quarter of 2010. In addition, the fourth quarter of 2010 included a $13 million gain recognized upon the sale of the Company's money market mutual fund business.
Noninterest Expense
Noninterest expense was $1,465 million in the current quarter compared with $1,548 million in the prior quarter and $1,361 million in the prior year. The decrease of $83 million, or 5%, on a sequential quarter basis was the result of anticipated reductions in marketing and technology expenses, following specific investment-related expenses incurred during the fourth quarter of 2010. In addition, credit-related expenses declined $34 million, or 18%, driven by lower other real estate expenses and credit and collections expenses. Personnel related expenses increased only $16 million, or 2%, despite seasonally higher 401(k) and payroll taxes in the current quarter, as other staff expenses declined. Total full-time equivalent employees were flat compared to the beginning of the quarter.
The increase in noninterest expense over the first quarter of 2010 was primarily driven by a $62 million increase in employee compensation and benefits attributable to a 3% increase in full-time equivalent employees and higher incentive compensation related to improved business performance. Credit-related expenses increased $12 million, or 8%, due to higher other real estate expenses. Outside processing and software expense increased $9 million, or 6%, due to investments in various risk management and client service-related technology projects. FDIC and regulatory expenses increased $7 million, or 11%, primarily due to increased deposit balances.
Income Taxes
In the first quarter of 2011, the Company recorded a provision for income taxes of $33 million compared with a provision of $45 million in the fourth quarter of 2010 and a benefit of $194 million in the first quarter of 2010. The effective tax rate for the current quarter was 15.5%.
U.S. Treasury Preferred Dividends
In the current and 2010 quarters, the Company recorded $66 million of preferred dividends related to the $4.85 billion in TARP preferred shares issued to the U.S. Treasury under the Capital Purchase Program. In addition, in conjunction with the current quarter redemption of TARP preferred shares, the Company incurred a non-cash charge to net income available to common shareholders of $74 million, or $0.14 per common diluted share, related to the unamortized discount on the TARP preferred shares.
Balance Sheet
As of March 31, 2011, SunTrust had total assets of $170.8 billion and shareholders' equity of $19.2 billion, representing 11.3% of total assets. During the first quarter, common shareholders' equity was increased as a result of the issuance of $1.0 billion in common equity, while total shareholders' equity declined $3.9 billion as a result of the redemption of the $4.9 billion in TARP preferred shares. Book and tangible book value per common share were $35.49 and $23.79, respectively, as of March 31, 2011.
Loans
During the current quarter, average loans were $115.2 billion, which compares with average balances of $114.9 billion and $114.4 billion during the fourth and first quarters of 2010, respectively. The relatively flat sequential quarter balance is the net effect of growth in targeted portfolios being offset by declines in higher-risk categories. Consumer loans grew due to the acquisition of high-quality auto loans during the fourth quarter of 2010, while commercial & industrial loans also increased. Sequential quarter declines occurred in higher-risk segments of the portfolio, including commercial construction and certain other real estate-related categories.
Compared to the first quarter of 2010, average loans increased $0.7 billion, or less than 1%. Growth was driven by the acquisition of auto and student loans, as well as from organic growth in commercial & industrial and government-guaranteed residential loans. The growth was offset by reductions in commercial construction, non-guaranteed residential mortgages, and home equity products. The net effect of the growth and declines within these particular loan categories resulted in a continued improvement in the risk profile of the portfolio. As of March 31, 2011, approximately 8% of the Company's loan portfolio was comprised of government-guaranteed loans.
Deposits
Consumer and commercial deposits in the first quarter of 2011 averaged $120.7 billion, which compares with average balances of $119.7 billion and $115.1 billion in the prior quarter and prior year, respectively. The sequential quarter increase of $1.0 billion, or 0.9%, was concentrated in all low-cost deposit categories, while time deposits continued to decline, resulting in continued improvement in the deposit mix.
The average balance growth compared to the first quarter of 2010 was $5.6 billion, or 5%. Growth was driven by low-cost deposits, primarily demand and money market accounts, which grew a combined $10.1 billion, or 17%, while time deposits declined $4.6 billion, or 19%. While changing client preferences and the economic environment have contributed to this favorable shift in deposit mix, SunTrust also attributes the low-cost deposit growth to its investments in enhancing the client experience, its marketing initiatives, and its growth in core households.
Capital and Liquidity
The Company enhanced the composition of its capital base in the first quarter via the issuance of $1.0 billion in common equity and the redemption of the $4.9 billion in TARP preferred shares. As a result, the estimated Tier 1 common equity ratio is expected to increase 92 bps to 9.00%. Due to the TARP preferred shares redemption, the Tier 1 capital and total capital ratios are expected to decline 267 and 264 basis points, respectively, compared to the prior quarter to 11.00% and 13.90%, respectively, as of March 31, 2011. The Company's capital position remains well above current regulatory requirements, as well as the proposed guidelines recently published by the Basel Committee and endorsed by U.S. regulatory agencies. The Company also continues to have substantial liquidity, as the inflows of deposits have largely been retained in cash or invested in high quality government-backed securities. In addition, the Company continues to have significant available borrowing capacity from its contingent funding sources, and it completed a $1.0 billion issuance of senior debt during the first quarter.
Asset Quality
Asset quality continued to improve during the quarter with net charge-offs, nonperforming loans, other real estate owned, and early stage delinquencies all declining compared to the fourth and first quarters of 2010.
Net charge-offs were $571 million in the current quarter compared with $621 million in the prior quarter and $821 million in the prior year. The $50 million sequential decline was concentrated in commercial loans, while other loan categories were relatively flat. Compared to the first quarter of 2010, net charge-offs declined $250 million, or 30%, with declines in all loan segments. For the current quarter, the ratio of annualized net charge-offs to total average loans was 2.01%, an improvement of 13 and 90 basis points from the prior quarter and the prior year, respectively. The provision for credit losses for the current quarter was $447 million, down $65 million from the fourth quarter of 2010 and down $415 million from the first quarter of 2010.
Nonperforming loans declined for the seventh consecutive quarter and, as of March 31, 2011, they were $4.0 billion. This compares with $4.1 billion in the prior quarter and $5.2 billion the prior year. The $139 million, or 3%, sequential decline in nonperforming loans was attributable to reductions in commercial construction and residential mortgage loans, partially offset by an increase in commercial real estate loans. A portion of the decline is attributable to the transfer of $57 million of nonperforming residential mortgage loans to loans held for sale, as the Company elected to actively market these loans for sale during the current quarter and intends to sell them during the second quarter. As a result of transferring these loans to held for sale, the Company recorded an incremental $10 million in charge-offs to reflect the lower of cost or market carrying value that is required for loans held for sale. The $1,214 million, or 23%, decline in nonperforming loans from the prior year is driven primarily by reductions in the commercial & industrial, commercial construction, residential mortgage, and residential construction loan classes. At the end of the current quarter, nonperforming loans represented 3.46% of total loans, down 8 basis points from the fourth quarter of 2010 and down 109 basis points from the end of the first quarter of 2010. As of March 31, 2011, other real estate owned totaled $534 million, down $62 million since year end.
Early stage delinquencies were 1.15% at quarter end, a modest improvement of 3 basis points from year end. Excluding government-guaranteed student loans and Ginnie Mae insured repurchased mortgage loans, early stage delinquencies were 0.80%, a decline of 10 basis points from year-end and 24 basis points from the prior year.
As of March 31, 2011, the allowance for loan losses was $2.9 billion representing 2.49% of total loans, down 9 basis points from year end. The allowance for loan losses declined $120 million during the current quarter as a result of the improvement in asset quality.
Accruing and nonaccruing restructured loans totaled $3.6 billion as of March 31, 2011, which was relatively stable compared to year end. $3.1 billion of restructured loans relate to residential mortgages, while $0.5 billion are loans to commercial clients.
LINE OF BUSINESS FINANCIAL PERFORMANCE
Line of Business Results
The Company has included line of business financial tables as part of this release on its website at www.suntrust.com in the Investor Relations section located under "About SunTrust." The Company's business segments are: Retail Banking, Diversified Commercial Banking, Corporate and Investment Banking, Mortgage, Wealth and Investment Management, and Commercial Real Estate. All revenue in the line of business tables is reported on a fully taxable-equivalent basis. For the lines of business, results include net interest income, which is computed using matched-maturity funds transfer pricing. Further, provision for loan losses is represented by net charge-offs. SunTrust also reports results for Corporate Other and Treasury, which includes the Treasury department as well as the residual expense associated with operational and support expense allocations. The Corporate Other and Treasury segment also includes differences created between internal management accounting practices and generally accepted accounting principles, certain matched-maturity funds transfer pricing credits and charges, differences in provision for loan losses compared to net charge-offs, as well as equity and its related impact. A detailed discussion of the line of business results will be included in the Company's forthcoming quarterly report on Form 10-Q.
Corresponding Financial Tables and Information
Investors are encouraged to review the foregoing summary and discussion of SunTrust's earnings and financial condition in conjunction with the detailed financial tables and information which SunTrust has also published today and SunTrust's forthcoming quarterly report on Form 10-Q. Detailed financial tables and other information are also available on the Company's website at www.suntrust.com in the Investor Relations section located under "About SunTrust." This information is also included in a current report on Form 8-K furnished with the Securities and Exchange Commission today.
Conference Call
SunTrust management will host a conference call on April 21, 2011, at 11:00 a.m. (Eastern Daylight Time) to discuss the earnings results and business trends. Individuals may call in beginning at 10:45 a.m. (Eastern Daylight Time) by dialing 1-888-972-7805 (Passcode: 1Q11). Individuals calling from outside the United States should dial 1-517-308-9091 (Passcode: 1Q11). A replay of the call will be available approximately one hour after the call ends on April 21, 2011, and will remain available until May 5, 2011, by dialing 1-800-294-9493 (domestic) or 1-402-220-3767 (international).
Alternatively, individuals may listen to the live webcast of the presentation by visiting the SunTrust investor relations website at www.suntrust.com/investorrelations. Beginning the afternoon of April 21, 2011, listeners may access an archived version of the webcast in the "Webcasts and Presentations" subsection found on the investor relations webpage. This webcast will be archived and available for one year. A link to the Investor Relations page is also found in the footer of the SunTrust home page.
SunTrust Banks, Inc., headquartered in Atlanta, is one of the nation's largest banking organizations, serving a broad range of consumer, commercial, corporate and institutional clients. The Company operates an extensive branch and ATM network throughout the Southeast and Mid-Atlantic states and a full array of technology-based, 24-hour delivery channels. The Company also serves clients in selected markets nationally. Its primary businesses include deposit, credit, and trust and investment management services. Through various subsidiaries, the Company provides mortgage banking, insurance, brokerage, equipment leasing, and capital markets services. SunTrust's Internet address is www.suntrust.com.
Important Cautionary Statement About Forward-Looking Statements
This news release includes non-GAAP financial measures to describe SunTrust's performance. The reconciliations of those measures to GAAP measures are provided within or in the appendix to this news release. In this news release, the Company presents net interest income and net interest margin on a fully taxable-equivalent ("FTE") basis, and ratios on an annualized basis. The FTE basis adjusts for the tax-favored status of income from certain loans and investments. The Company believes this measure to be the preferred industry measurement of net interest income and provides relevant comparison between taxable and non-taxable amounts.
This news release may contain forward-looking statements. Statements that do not describe historical or current facts are forward-looking statements. These statements often include the words "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," "initiatives," "potentially," "potential impacts," "probably," "projects," "outlook" or similar expressions or future conditional verbs such as "may," "will," "should," "would," and "could." Forward-looking statements are based upon the current beliefs and expectations of management and on information currently available to management. Such statements speak as of the date hereof, and we do not assume any obligation to update the statements made herein or to update the reasons why actual results could differ from those contained in such statements in light of new information or future events.
Forward-looking statements are subject to significant risks and uncertainties. Investors are cautioned against placing undue reliance on such statements. Actual results may differ materially from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those described in the forward-looking statements can be found in Item 1A of Part I of our 10-K and in other periodic reports that we file with the SEC. Those factors include: difficult market conditions have adversely affected our industry; concerns over market volatility continue; recently enacted legislation, legislation enacted in the future, and certain proposed federal programs subject us to increased regulation and may adversely affect us; the Dodd-Frank Act makes fundamental changes to the regulation of the financial services industry, some of which may adversely affect our business; SunTrust Bank may be subject to higher deposit insurance assessments; we are subject to capital adequacy and liquidity guidelines and, if we fail to meet these guidelines, our financial condition would be adversely affected; emergency measures designed to stabilize the U.S. banking system are beginning to wind down; we are subject to credit risk; our ALLL may not be adequate to cover our eventual losses; we will realize future losses if the proceeds we receive upon liquidation of nonperforming assets are less than the carrying value of such assets; weakness in the economy and in the real estate market, including specific weakness within our geographic footprint, has adversely affected us and may continue to adversely affect us; weakness in the real estate market, including the secondary residential mortgage loan markets, has adversely affected us and may continue to adversely affect us; we are subject to certain risks from originating, selling, and holding mortgages, including the risk that we may be required to repurchase mortgage loans or indemnify mortgage loan purchasers as a result of breaches of representations and warranties, borrower fraud, or certain borrower defaults, which could harm our liquidity, results of operations, and financial condition; we are subject to risks related to delays in the foreclosure process; we may continue to suffer increased losses in our loan portfolio despite enhancement of our underwriting policies; as a financial services company, adverse changes in general business or economic conditions could have a material adverse effect on our financial condition and results of operations; changes in market interest rates or capital markets could adversely affect our revenue and expense, the value of assets and obligations, and the availability and cost of capital or liquidity; the fiscal and monetary policies of the federal government and its agencies could have a material adverse effect on our earnings; depressed market values for our stock may require us to write down goodwill; clients could pursue alternatives to bank deposits, causing us to lose a relatively inexpensive source of funding; consumers may decide not to use banks to complete their financial transactions, which could affect net income; we have businesses other than banking which subject us to a variety of risks; hurricanes and other natural or man-made disasters may adversely affect loan portfolios and operations and increase the cost of doing business; negative public opinion could damage our reputation and adversely impact business and revenues; the soundness of other financial institutions could adversely affect us; we rely on other companies to provide key components of our business infrastructure; we rely on our systems, employees, and certain counterparties, and certain failures could materially adversely affect our operations; we depend on the accuracy and completeness of information about clients and counterparties; regulation by federal and state agencies could adversely affect the business, revenue, and profit margins; competition in the financial services industry is intense and could result in losing business or margin declines; maintaining or increasing market share depends on market acceptance and regulatory approval of new products and services; we may not pay dividends on your common stock; our ability to receive dividends from our subsidiaries could affect our liquidity and ability to pay dividends; disruptions in our ability to access global capital markets may negatively affect our capital resources and liquidity; any reduction in our credit rating could increase the cost of our funding from the capital markets; we have in the past and may in the future pursue acquisitions, which could affect costs and from which we may not be able to realize anticipated benefits; we are subject to certain litigation, and our expenses related to this litigation may adversely affect our results; we depend on the expertise of key personnel, and if these individuals leave or change their roles without effective replacements, operations may suffer; we may not be able to hire or retain additional qualified personnel and recruiting and compensation costs may increase as a result of turnover, both of which may increase costs and reduce profitability and may adversely impact our ability to implement our business strategy; our accounting policies and processes are critical to how we report our financial condition and results of operations, and require management to make estimates about matters that are uncertain; changes in our accounting policies or in accounting standards could materially affect how we report our financial results and condition; our stock price can be volatile; our disclosure controls and procedures may not prevent or detect all errors or acts of fraud; our financial instruments carried at fair value expose us to certain market risks; our revenues derived from our investment securities may be volatile and subject to a variety of risks; and we may enter into transactions with off-balance sheet affiliates or our subsidiaries.
SunTrust Banks, Inc. and Subsidiaries |
|||||||
FINANCIAL HIGHLIGHTS |
|||||||
(Dollars in millions, except per share data) (Unaudited) |
|||||||
Three Months Ended |
|||||||
March 31 |
% |
||||||
2011 |
2010 |
Change (5) |
|||||
EARNINGS & DIVIDENDS |
|||||||
Net income/(loss) |
$180 |
($161) |
NM |
% |
|||
Net income/(loss) available to common shareholders |
38 |
(229) |
NM |
||||
Total revenue - FTE (2) |
2,160 |
1,900 |
14 |
||||
Total revenue - FTE excluding securities gains, net (1, 2) |
2,096 |
1,899 |
10 |
||||
Net income/(loss) per average common share |
|||||||
Diluted (4) |
0.08 |
(0.46) |
NM |
||||
Diluted excluding effect of accelerated accretion associated |
|||||||
with repurchase of preferred stock issued to the U.S. Treasury (1) |
0.22 |
(0.46) |
NM |
||||
Basic |
0.08 |
(0.46) |
NM |
||||
Dividends paid per common share |
0.01 |
0.01 |
- |
||||
CONDENSED BALANCE SHEETS |
|||||||
Selected Average Balances |
|||||||
Total assets |
$173,066 |
$171,429 |
1 |
% |
|||
Earning assets |
146,786 |
146,896 |
- |
||||
Loans |
115,162 |
114,435 |
1 |
||||
Consumer and commercial deposits |
120,710 |
115,084 |
5 |
||||
Brokered and foreign deposits |
2,606 |
3,433 |
(24) |
||||
Total shareholders' equity |
23,107 |
22,338 |
3 |
||||
As of |
|||||||
Total assets |
170,794 |
171,796 |
(1) |
||||
Earning assets |
145,895 |
147,056 |
(1) |
||||
Loans |
114,932 |
113,979 |
1 |
||||
Allowance for loan and lease losses |
2,854 |
3,176 |
(10) |
||||
Consumer and commercial deposits |
121,559 |
116,144 |
5 |
||||
Brokered and foreign deposits |
2,426 |
2,606 |
(7) |
||||
Total shareholders' equity |
19,223 |
22,620 |
(15) |
||||
FINANCIAL RATIOS & OTHER DATA |
|||||||
Return on average total assets |
0.42 |
% |
(0.38) |
% |
NM |
% |
|
Return on average assets less net unrealized |
|||||||
securities gains (1) |
0.30 |
(0.42) |
NM |
||||
Return on average common shareholders' equity |
0.84 |
(5.34) |
NM |
||||
Return on average realized common shareholders' equity (1) |
(0.35) |
(5.93) |
NM |
||||
Net interest margin (2) |
3.53 |
3.32 |
6 |
||||
Efficiency ratio (2) |
67.83 |
71.60 |
(5) |
||||
Tangible efficiency ratio (1, 2) |
67.32 |
70.91 |
(5) |
||||
Effective tax rate/(benefit) |
15.54 |
(54.70) |
NM |
||||
Tier 1 common equity |
9.00 |
(3) |
7.70 |
17 |
|||
Tier 1 capital |
11.00 |
(3) |
13.13 |
(16) |
|||
Total capital |
13.90 |
(3) |
16.68 |
(17) |
|||
Tier 1 leverage |
8.70 |
(3) |
10.95 |
(21) |
|||
Total average shareholders' equity to total average assets |
13.35 |
13.03 |
2 |
||||
Tangible equity to tangible assets (1) |
7.87 |
9.86 |
(20) |
||||
Book value per common share |
$35.49 |
$35.40 |
- |
||||
Tangible book value per common share (1) |
23.79 |
22.76 |
5 |
||||
Market price: |
|||||||
High |
33.14 |
28.39 |
17 |
||||
Low |
27.38 |
20.16 |
36 |
||||
Close |
28.84 |
26.79 |
8 |
||||
Market capitalization |
15,482 |
13,391 |
16 |
||||
Average common shares outstanding (000s) |
|||||||
Diluted |
503,503 |
498,238 |
1 |
||||
Basic |
499,669 |
494,871 |
1 |
||||
Full-time equivalent employees |
29,052 |
28,263 |
3 |
||||
Number of ATMs |
2,924 |
2,828 |
3 |
||||
Full service banking offices |
1,665 |
1,678 |
(1) |
||||
(1) See Appendix A for reconcilements of non-GAAP performance measures. |
|||||||
(2) Total revenue, net interest margin, and efficiency ratios 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 a FTE basis plus noninterest income. |
|||||||
(3) Current period tier 1 common equity, tier 1 capital, total capital and tier 1 leverage ratios are estimated as of the earnings release date. |
|||||||
(4) For earnings per share calculation purposes, the impact of dilutive securities are excluded from the diluted share count during periods that the Company has recognized a net loss available to common shareholders because the impact would be antidilutive. |
|||||||
(5) "NM" - Not meaningful. Those changes over 100 percent were not considered to be meaningful. |
|||||||
SunTrust Banks, Inc. and Subsidiaries |
|||||||||||
FIVE QUARTER FINANCIAL HIGHLIGHTS |
|||||||||||
(Dollars in millions, except per share data) (Unaudited) |
|||||||||||
Three Months Ended |
|||||||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
|||||||
2011 |
2010 |
2010 |
2010 |
2010 |
|||||||
EARNINGS & DIVIDENDS |
|||||||||||
Net income/(loss) |
$180 |
$185 |
$153 |
$12 |
($161) |
||||||
Net income/(loss) available to common shareholders |
38 |
114 |
84 |
(56) |
(229) |
||||||
Total revenue - FTE (2) |
2,160 |
2,326 |
2,313 |
2,160 |
1,900 |
||||||
Total revenue - FTE excluding securities gains, net (1, 2) |
2,096 |
2,262 |
2,244 |
2,103 |
1,899 |
||||||
Net income/(loss) per average common share |
|||||||||||
Diluted (4) |
0.08 |
0.23 |
0.17 |
(0.11) |
(0.46) |
||||||
Diluted excluding effect of accelerated accretion associated |
|||||||||||
with repurchase of preferred stock issued to the U.S. Treasury (1) |
0.22 |
0.23 |
0.17 |
(0.11) |
(0.46) |
||||||
Basic |
0.08 |
0.23 |
0.17 |
(0.11) |
(0.46) |
||||||
Dividends paid per common share |
0.01 |
0.01 |
0.01 |
0.01 |
0.01 |
||||||
CONDENSED BALANCE SHEETS |
|||||||||||
Selected Average Balances |
|||||||||||
Total assets |
$173,066 |
$174,768 |
$171,999 |
$171,273 |
$171,429 |
||||||
Earning assets |
146,786 |
149,114 |
147,249 |
145,464 |
146,896 |
||||||
Loans |
115,162 |
114,930 |
113,322 |
113,016 |
114,435 |
||||||
Consumer and commercial deposits |
120,710 |
119,688 |
117,233 |
116,460 |
115,084 |
||||||
Brokered and foreign deposits |
2,606 |
2,827 |
2,740 |
2,670 |
3,433 |
||||||
Total shareholders' equity |
23,107 |
23,576 |
23,091 |
22,313 |
22,338 |
||||||
As of |
|||||||||||
Total assets |
170,794 |
172,874 |
174,703 |
170,668 |
171,796 |
||||||
Earning assets |
145,895 |
148,473 |
149,994 |
145,601 |
147,056 |
||||||
Loans |
114,932 |
115,975 |
115,055 |
112,925 |
113,979 |
||||||
Allowance for loan and lease losses |
2,854 |
2,974 |
3,086 |
3,156 |
3,176 |
||||||
Consumer and commercial deposits |
121,559 |
120,025 |
117,494 |
116,261 |
116,144 |
||||||
Brokered and foreign deposits |
2,426 |
3,019 |
2,850 |
2,407 |
2,606 |
||||||
Total shareholders' equity |
19,223 |
23,130 |
23,438 |
23,024 |
22,620 |
||||||
FINANCIAL RATIOS & OTHER DATA |
|||||||||||
Return on average total assets |
0.42 |
% |
0.42 |
% |
0.35 |
% |
0.03 |
% |
(0.38) |
% |
|
Return on average assets less net unrealized |
|||||||||||
securities (gains)/losses (1) |
0.30 |
0.31 |
0.23 |
(0.08) |
(0.42) |
||||||
Return on average common shareholders' equity |
0.84 |
2.44 |
1.83 |
(1.29) |
(5.34) |
||||||
Return on average realized common shareholders' equity (1) |
(0.35) |
1.53 |
0.70 |
(2.53) |
(5.93) |
||||||
Net interest margin (2) |
3.53 |
3.44 |
3.41 |
3.33 |
3.32 |
||||||
Efficiency ratio (2) |
67.83 |
66.57 |
64.80 |
69.57 |
71.60 |
||||||
Tangible efficiency ratio (1, 2) |
67.32 |
66.07 |
64.24 |
68.96 |
70.91 |
||||||
Effective tax rate/(benefit) |
15.54 |
19.66 |
8.25 |
(133.13) |
(54.70) |
||||||
Tier 1 common equity |
9.00 |
(3) |
8.08 |
8.02 |
7.92 |
7.70 |
|||||
Tier 1 capital |
11.00 |
(3) |
13.67 |
13.58 |
13.51 |
13.13 |
|||||
Total capital |
13.90 |
(3) |
16.54 |
16.42 |
16.96 |
16.68 |
|||||
Tier 1 leverage |
8.70 |
(3) |
10.94 |
11.03 |
10.94 |
10.95 |
|||||
Total average shareholders' equity to total average assets |
13.35 |
13.49 |
13.42 |
13.03 |
13.03 |
||||||
Tangible equity to tangible assets (1) |
7.87 |
10.12 |
10.19 |
10.18 |
9.86 |
||||||
Book value per common share |
$35.49 |
$36.34 |
$37.01 |
$36.19 |
$35.40 |
||||||
Tangible book value per common share (1) |
23.79 |
23.76 |
24.42 |
23.58 |
22.76 |
||||||
Market price: |
|||||||||||
High |
33.14 |
29.82 |
27.05 |
31.92 |
28.39 |
||||||
Low |
27.38 |
23.25 |
21.79 |
23.12 |
20.16 |
||||||
Close |
28.84 |
29.51 |
25.83 |
23.30 |
26.79 |
||||||
Market capitalization |
15,482 |
14,768 |
12,914 |
11,648 |
13,391 |
||||||
Average common shares outstanding (000s) |
|||||||||||
Diluted |
503,503 |
499,423 |
498,802 |
498,499 |
498,238 |
||||||
Basic |
499,669 |
495,710 |
495,501 |
495,351 |
494,871 |
||||||
Full-time equivalent employees |
29,052 |
29,056 |
28,599 |
28,250 |
28,263 |
||||||
Number of ATMs |
2,924 |
2,918 |
2,928 |
2,902 |
2,828 |
||||||
Full service banking offices |
1,665 |
1,668 |
1,670 |
1,675 |
1,678 |
||||||
(1) See Appendix A for reconcilements of non-GAAP performance measures. |
|||||||||||
(2) Total revenue, net interest margin, and efficiency ratios 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 a FTE basis plus noninterest income. |
|||||||||||
(3) Current period tier 1 common equity, tier 1 capital, total capital and tier 1 leverage ratios are estimated as of the earnings release date. |
|||||||||||
(4) For earnings per share calculation purposes, the impact of dilutive securities are excluded from the diluted share count during periods that the Company has recognized a net loss available to common shareholders because the impact would be antidilutive. |
|||||||||||
SunTrust Banks, Inc. and Subsidiaries |
|||||||||||
RECONCILEMENT OF NON-GAAP MEASURES |
|||||||||||
APPENDIX A TO THE EARNINGS RELEASE |
|||||||||||
(Dollars in millions, except per share data) (Unaudited) |
|||||||||||
Three Months Ended |
|||||||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
|||||||
2011 |
2010 |
2010 |
2010 |
2010 |
|||||||
NON-GAAP MEASURES PRESENTED IN THE EARNINGS RELEASE (8) |
|||||||||||
Total average assets |
$173,066 |
$174,768 |
$171,999 |
$171,273 |
$171,429 |
||||||
Average net unrealized securities gains |
(2,294) |
(2,664) |
(2,395) |
(1,969) |
(1,884) |
||||||
Average assets less net unrealized securities gains |
$170,772 |
$172,104 |
$169,604 |
$169,304 |
$169,545 |
||||||
Total average common shareholders' equity |
$18,269 |
$18,638 |
$18,159 |
$17,387 |
$17,419 |
||||||
Average accumulated other comprehensive income |
(1,530) |
(2,055) |
(1,721) |
(998) |
(889) |
||||||
Total average realized common shareholders' equity |
$16,739 |
$16,583 |
$16,438 |
$16,389 |
$16,530 |
||||||
Return on average total assets |
0.42 |
% |
0.42 |
% |
0.35 |
% |
0.03 |
% |
(0.38) |
% |
|
Impact of excluding net realized and unrealized securities (gains)/losses |
|||||||||||
and The Coca-Cola Company stock dividend |
(0.12) |
(0.11) |
(0.12) |
(0.11) |
(0.04) |
||||||
Return on average total assets less net unrealized securities gains (1) |
0.30 |
% |
0.31 |
% |
0.23 |
% |
(0.08) |
% |
(0.42) |
% |
|
Return on average common shareholders' equity |
0.84 |
% |
2.44 |
% |
1.83 |
% |
(1.29) |
% |
(5.34) |
% |
|
Impact of excluding net realized and unrealized securities (gains)/losses |
|||||||||||
and The Coca-Cola Company stock dividend |
(1.19) |
(0.91) |
(1.13) |
(1.24) |
(0.59) |
||||||
Return on average realized common shareholders' equity (2) |
(0.35) |
% |
1.53 |
% |
0.70 |
% |
(2.53) |
% |
(5.93) |
% |
|
Efficiency ratio (3) |
67.83 |
% |
66.57 |
% |
64.80 |
% |
69.57 |
% |
71.60 |
% |
|
Impact of excluding amortization of intangible assets |
(0.51) |
(0.50) |
(0.56) |
(0.61) |
(0.69) |
||||||
Tangible efficiency ratio (4) |
67.32 |
% |
66.07 |
% |
64.24 |
% |
68.96 |
% |
70.91 |
% |
|
Total shareholders' equity |
$19,223 |
$23,130 |
$23,438 |
$23,024 |
$22,620 |
||||||
Goodwill, net of deferred taxes |
(6,185) |
(6,189) |
(6,192) |
(6,197) |
(6,202) |
||||||
Other intangible assets including MSRs, net of deferred taxes |
(1,635) |
(1,545) |
(1,174) |
(1,409) |
(1,761) |
||||||
MSRs |
1,538 |
1,439 |
1,072 |
1,298 |
1,641 |
||||||
Tangible equity |
12,941 |
16,835 |
17,144 |
16,716 |
16,298 |
||||||
Preferred stock |
(172) |
(4,942) |
(4,936) |
(4,929) |
(4,923) |
||||||
Tangible common equity |
$12,769 |
$11,893 |
$12,208 |
$11,787 |
$11,375 |
||||||
Total assets |
$170,794 |
$172,874 |
$174,703 |
$170,668 |
$171,796 |
||||||
Goodwill |
(6,324) |
(6,323) |
(6,323) |
(6,323) |
(6,323) |
||||||
Other intangible assets including MSRs |
(1,659) |
(1,571) |
(1,204) |
(1,443) |
(1,800) |
||||||
MSRs |
1,538 |
1,439 |
1,072 |
1,298 |
1,641 |
||||||
Tangible assets |
$164,349 |
$166,419 |
$168,248 |
$164,200 |
$165,314 |
||||||
Tangible equity to tangible assets (5) |
7.87 |
% |
10.12 |
% |
10.19 |
% |
10.18 |
% |
9.86 |
% |
|
Tangible book value per common share (6) |
$23.79 |
$23.76 |
$24.42 |
$23.58 |
$22.76 |
||||||
Net interest income |
$1,249 |
$1,266 |
$1,238 |
$1,178 |
$1,172 |
||||||
Taxable-equivalent adjustment |
28 |
28 |
28 |
30 |
30 |
||||||
Net interest income - FTE |
1,277 |
1,294 |
1,266 |
1,208 |
1,202 |
||||||
Noninterest income |
883 |
1,032 |
1,047 |
952 |
698 |
||||||
Total revenue - FTE |
2,160 |
2,326 |
2,313 |
2,160 |
1,900 |
||||||
Securities gains, net |
(64) |
(64) |
(69) |
(57) |
(1) |
||||||
Total revenue - FTE excluding net securities gains (7) |
$2,096 |
$2,262 |
$2,244 |
$2,103 |
$1,899 |
||||||
(1) SunTrust presents a return on average assets less net unrealized gains on securities. The foregoing numbers primarily reflect adjustments to remove the effects of the securities portfolio which includes the ownership by the Company of common shares of The Coca-Cola Company. The Company uses this information internally to gauge its actual performance in the industry. The Company believes that the return on average assets less the net unrealized securities gains is more indicative of the Company's return on assets because it more accurately reflects the return on the assets that are related to the Company's core businesses which are primarily client relationship and client transaction driven. The return on average assets less net unrealized gains on securities is computed by dividing annualized net income/(loss), excluding securities (gains)/losses and The Coca-Cola Company stock dividend, net of tax, by average assets less net unrealized securities (gains)/losses. |
|||||||||||
(2) SunTrust believes that the return on average realized common shareholders' equity is more indicative of the Company's return on equity because the excluded equity relates primarily to the holding of a specific security. The return on average realized common shareholders' equity is computed by dividing annualized net income/(loss) available to common shareholders, excluding securities (gains)/losses and The Coca-Cola Company stock dividend, net of tax, by average realized common shareholders' equity. |
|||||||||||
(3) Computed by dividing noninterest expense by total revenue - FTE. 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. |
|||||||||||
(4) SunTrust presents a tangible efficiency ratio which excludes the amortization of intangible assets other than MSRs. The Company believes this measure is useful to investors because, by removing the effect of these intangible asset costs (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. |
|||||||||||
(5) SunTrust presents a tangible equity to tangible assets ratio that excludes the after-tax impact of purchase accounting intangible assets. The Company believes this measure is useful to investors because, by removing the effect of intangible assets that result from merger and acquisition activity (the level of which may vary from company to company), it allows investors to more easily compare the Company's capital adequacy to other companies in the industry. This measure is used by management to analyze capital adequacy. |
|||||||||||
(6) SunTrust presents a tangible book value per common share that excludes the after-tax impact of purchase accounting intangible assets and also excludes preferred stock from tangible equity. The Company believes this measure is useful to investors because, by removing the effect of intangible assets that result from merger and acquisition activity as well as preferred stock (the level of which may vary from company to company), it allows investors to more easily compare the Company's book value on common stock to other companies in the industry. |
|||||||||||
(7) SunTrust presents total revenue - FTE excluding net securities gains. The Company believes noninterest income without net securities gains is more indicative of the Company's performance because it isolates income that is primarily client relationship and client transaction driven and is more indicative of normalized operations. |
|||||||||||
(8) Certain amounts in this schedule are presented net of applicable income taxes, which are calculated based on each subsidiary’s federal and state tax rates and laws. In general, the federal marginal tax rate is 35%, but the state marginal tax rates range from 1% to 8% in accordance with the subsidiary’s income tax filing requirements with various tax authorities. In addition, the effective tax rate may differ from the federal and state marginal tax rates in certain cases where a permanent difference exists. |
|||||||||||
SunTrust Banks, Inc. and Subsidiaries |
||||||||||
RECONCILEMENT OF NON-GAAP MEASURES |
||||||||||
APPENDIX A TO THE EARNINGS RELEASE, continued |
||||||||||
(Dollars in millions, except per share data) (Unaudited) |
||||||||||
Three Months Ended |
||||||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||||||
2011 |
2010 |
2010 |
2010 |
2010 |
||||||
NON-GAAP MEASURES PRESENTED IN THE EARNINGS RELEASE (1) |
||||||||||
Net income/(loss) |
$180 |
$185 |
$153 |
$12 |
($161) |
|||||
Preferred dividends, Series A |
(2) |
(2) |
(2) |
(2) |
(2) |
|||||
U.S. Treasury preferred dividends and accretion of discount |
(66) |
(67) |
(67) |
(66) |
(66) |
|||||
Accelerated accretion associated with repurchase of preferred stock |
||||||||||
issued to the U.S. Treasury |
(74) |
- |
- |
- |
- |
|||||
Dividends and undistributed earnings allocated to unvested shares |
- |
(2) |
- |
- |
- |
|||||
Net income/(loss) available to common shareholders |
38 |
114 |
84 |
(56) |
(229) |
|||||
Securities gains, net of tax |
(40) |
(39) |
(43) |
(35) |
(1) |
|||||
The Coca-Cola Company stock dividend, net of tax |
(13) |
(12) |
(12) |
(12) |
(12) |
|||||
Net income/(loss) available to common shareholders excluding securities |
||||||||||
gains and The Coca-Cola Company stock dividend, net of tax |
($15) |
$63 |
$29 |
($103) |
($242) |
|||||
Net income/(loss) excluding securities gains and The Coca-Cola Company |
||||||||||
stock dividend, net of tax |
$127 |
$134 |
$98 |
($35) |
($174) |
|||||
Net income/(loss) available to common shareholders |
$38 |
$114 |
$84 |
($56) |
($229) |
|||||
Accelerated accretion associated with repurchase of preferred stock |
||||||||||
issued to the U.S. Treasury |
74 |
- |
- |
- |
- |
|||||
Net income/(loss) available to common shareholders excluding accelerated |
||||||||||
accretion associated with repurchase of preferred stock issued to the |
||||||||||
U.S. Treasury |
$112 |
$114 |
$84 |
($56) |
($229) |
|||||
Net income/(loss) per average common share - diluted |
$0.08 |
$0.23 |
$0.17 |
($0.11) |
($0.46) |
|||||
Effect of accelerated accretion associated with repurchase of preferred stock |
||||||||||
issued to the U.S. Treasury |
0.14 |
- |
- |
- |
- |
|||||
Net income/(loss) per average common share - diluted, excluding effect of |
||||||||||
accelerated accretion associated with repurchase of preferred stock |
||||||||||
issued to the U.S. Treasury |
$0.22 |
$0.23 |
$0.17 |
($0.11) |
($0.46) |
|||||
(1) Certain amounts in this schedule are presented net of applicable income taxes, which are calculated based on each subsidiary’s federal and state tax rates and laws. In general, the federal marginal tax rate is 35%, but the state marginal tax rates range from 1% to 8% in accordance with the subsidiary’s income tax filing requirements with various tax authorities. In addition, the effective tax rate may differ from the federal and state marginal tax rates in certain cases where a permanent difference exists. |
||||||||||
SOURCE SunTrust Banks, Inc.
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