BB&T on Thursday said profits fell 1.6 percent in the first quarter from a year ago as the Winston-Salem-based bank joined other lenders feeling squeezed by low interest rates.
The bank’s shares were down about 2 percent to $38.06 in morning trading.
BB&T reported $488 million in net income available to common shareholders, compared with $496 million in the same period a year earlier. Adjusted earnings per share of 68 cents fell just short of analyst estimates compiled by Bloomberg.
Commercial banks are struggling to increase revenue from bread-and-butter lending as low interest rates shrink their net interest margins, the difference between the interest they charge for loans and what they pay on deposits. BB&T’s total revenue increased about 1.5 percent, as an increase in fee income overcame a decline in net interest income.
Expenses rose 2.7 percent, partly on increased merger-related costs. During the quarter, BB&T completed the purchase of 41 branches in Texas, and it said planned acquisitions of The Bank of Kentucky and Susquehanna Bancshares are on track to close this year.
“Given the challenges of the current rate environment, I am pleased with our financial performance and other accomplishments during the quarter,” CEO Kelly King said in a statement. “We enjoyed solid loan growth, good expense control in a seasonally challenging quarter and outstanding credit quality.”
In the Charlotte market, BB&T is the third-largest bank by deposits.
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