Wednesday, January 12, 2011

BB&T Capital's (NYSE:BBT) Volatility Could Rise on Tougher Stance

The recent decision by BB&T Capital (NYSE:BBT) to take a tougher stance in reference to their troubled loan portfolios could generate volatility in the short term.

Barclays noted, "Despite having only recently taken a
harder stance with respect to its troubled loan portfolios, BB&T appears to be making progress. Furthermore, its non-R/E related loan growth appears to be taking hold. However, near-term net interest margin pressure should keep net interest income (60% of revenues) from expanding. Also, inflows into nonaccrual assets remained in excess of $1.2 billion in 3Q10 suggesting to us that asset quality concerns remain warranted.

"Results: We look for BBT to report 4Q10 EPS of $0.33 versus the $0.26 consensus. Still, we caution that its more aggressive stance on troubled asset disposition could introduce volatility into near-term results."

Barclays maintains an "Underweight' ratingon BB&T Capital, which closed Tuesday at $26.53, gaining $0.09, or 0.34 percent. Barclays has a price target of $32 on BB&T.

1 comment:

Anonymous said...

It's BB&T Corp, not Capital