Although it never swirled the drain like many larger and better-known banks, and was aggressive in dealing with its sour loans, large regional bank BB&T (BBT) has to fight to get much respect from the analyst and institutional investor community. Given that the market seemingly believes that the prior decades of top-tier performance were a mirage, investors can still buy into a solid and growing banking franchise with relatively modest expectations built into the price.
Still Hungry For More
BB&T has seldom been shy about doing deals and little has changed in recent times. The company was able to acquire Colonial as a byproduct of the credit crisis and recently reached a deal with BankAtlantic to essentially buy that company's good assets without taking on the bad. This deal, coming at the cost of a 9% deposit premium) will vault BB&T from #14 in Miami to #6 and significantly enhance its Florida footprint – one of its few remaining market share weak points. Based on other recent deals (including PNC's (PNC) deal for Royal Bank of Canada's (RY) U.S. assets and the Comerica (CMA)-Sterling deal), BBT paid a fair price, particularly given the much-reduced credit risks.
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BB&T Gets Little Credit Where Credit Is Due
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