NEW YORK--(BUSINESS WIRE)-- Today, Fitch has affirmed the long-term and short-term Issuer Default Ratings (IDRs) of BB&T Corporation (BB&T) and its bank subsidiary, Branch Banking & Trust Company at 'A+' and 'F1', respectively, following its acquisition of the banking operations of Colonial BancGroup (CNB) through an FDIC assisted transaction. The Rating Outlook remains Negative. A complete list of ratings follows at the end of this release.

The acquisition of CNB's banking operations significantly augments BB&T's considerable deposit franchise in the Southeast U.S. and extends its reach into the Texas and Nevada markets. BB&T will be acquiring the majority of the deposits of Colonial Bank, as well as most of the assets of CNB. Despite BB&T acquiring CNB's problematic loan book, which has a sizeable concentration of real estate exposure in Florida, Fitch believes there is adequate risk mitigation that will limit the risk of loss to the company.

From a strategic perspective, Fitch views the transaction as favorable for BB&T, as the company should be able to leverage its banking prowess across an enhanced banking franchise with minimal risk. Additionally, the company should benefit from some moderate cost savings overtime.

The maintenance of the Negative Outlook considers the prospect that the current negative trends in asset quality and earnings performance, separate from the CNB transaction, could materially worsen given Fitch's expectation for higher loss rates across various loan categories, particularly for commercial real estate. That said, BB&T's conservative underwriting and highly granular loan portfolio should contain credit deterioration, with problem assets and credit losses expected to remain at manageable levels. Further, while Fitch has concerns about the company's real estate exposure, BB&T's real estate portfolio, at approximately 20% of the loan book, is not substantially larger than its peers.

BB&T is among the largest banking companies in the U.S. with over $140 billion in assets and 1,500 branches, spanning the Southeast and Mid-Atlantic states. The company's operations also include a sizeable insurance agency franchise, as well as an investment banking company and a national finance company.


The following ratings have been affirmed:

BB&T Corporation

--Long-term IDR at 'A+';

--Short-term IDR at 'F1';

--Senior Debt at 'A+';

--Subordinated debt at 'A';

--Short-term debt at 'F1';

--Individual at 'B'

--Support at '5'

--Support Floor at 'NF'

Branch Banking & Trust Company

--Long-term IDR at 'A+';

--Short-term IDR at 'F1 '

--Subordinated debt at 'A'

--Short-term debt at 'F1'

--Long-term deposits at 'AA-'

--Short-Term deposit at 'F1+'

--Individual at 'B'

--Support at '4'

--Support Floor at 'B'

BB&T Financial, FSB

--Long-term IDR at 'A+'

--Short-term IDR at 'F1'

--Individual at 'B'

--Support at '4'

--Support Floor at 'B'

BB&T Capital Trust I

BB&T Capital Trust II

BB&T Capital Trust IV

BB&T Capital Trust V

--Preferred Stock 'A-'

The following rating has been assigned:

BB&T Capital Trust VI

--Preferred Stock 'A- '

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, 'www.fitchratings.com'. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.





Fitch Ratings, New York

Kenneth Ritz, 212-908-0368

Eric Newell, 212-908-1769

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Source: Fitch Ratings