36
2005 ANNUAL REVIEW There’s opportunity here

AR BBT Annual2005

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Page 1: AR BBT Annual2005

2 0 0 5 A N N U A L R E V I E WT h e r e ’s o p p o r t u n i t y h e r e

32308 3/6/06 12:10 PM Page 2

Page 2: AR BBT Annual2005

20BB&T

32308 3/3/06 8:52 AM Page 3

Page 3: AR BBT Annual2005

Consolidated Financial Highlights 2

Corporate Profile 4

To Our Shareholders 6

Corporate Board of Directors 22

Executive Management 23

Market Coverage 24

Shareholder Information 26

Consolidated Balance Sheets 28

Consolidated Statements of Income 29

Selected Financial Data 30

Selected Ratios 31

General Information 32

2006 ANNUAL MEETING

BB&T Corporation’s Annual

Meeting of Shareholders will

be held at the Embassy Suites

Winston-Salem at 460 North

Cherry Street, Winston-Salem,

North Carolina, on Tuesday,

April 25, 2006 at 11:00 a.m.

“About the Cover“There’s Opportunity Here” by Bryan Larsen, “special commission for BB&T“© 2006 Bryan Larsen“Quent Cordair Fine Art“1-866-267-3247 – www.cordair.com

TA B L E O F C O N T E N T S

ANNUAL REVIEW0 05

Page 4: AR BBT Annual2005

2

Consolidated Financial Highlights

BB&T Corporation and Subsidiaries(Dollars in millions, except per share data)

2005 2004 % Change

Annual ResultsNet income $ 1,654 $ 1,558 6.1 %Net income per common share:

Basic 3.02 2.82 7.1 Diluted 3.00 2.80 7.1

Cash dividends paid per common share 1.46 1.34 9.0

Annual Operating Results (1)Operating earnings $ 1,674 $ 1,562 7.2 %Operating earnings per common share:

Basic 3.06 2.83 8.1 Diluted 3.04 2.81 8.2

Annual Cash Basis Operating Results (1,2)Cash basis operating earnings $ 1,763 $ 1,646 7.1 %Cash basis operating earnings per common share:

Basic 3.22 2.98 8.1 Diluted 3.20 2.96 8.1

Year-End BalancesAssets $ 109,170 $ 100,509 8.6 %Securities, at carrying value 20,489 19,173 6.9Loans and leases 75,023 68,163 10.1Deposits 74,282 67,699 9.7Shareholders’ equity 11,129 10,874 2.3 Book value per common share 20.49 19.76 3.7

Average BalancesAssets $ 104,612 $ 96,276 8.7 %Securities, at amortized cost 20,467 18,218 12.3 Loans and leases 71,517 66,107 8.2 Deposits 70,346 64,816 8.5 Shareholders’ equity 11,065 10,597 4.4

Performance Ratios Based on Net IncomeReturn on average assets 1.58 % 1.62 %Return on average equity 14.95 14.71

Page 5: AR BBT Annual2005

3

(1) Information presented on an operating basis excludes the effects of $(6.8 million) and $3.5 million of net after-tax costs associated with the completion of mergers and acquisitions in 2005 and 2004, respectively. In addition, operating results in 2005 exclude the effects of a one-time charge related to the accounting for leases, which totaled $26.6 million, net of tax.

(2) Information presented on a cash basis excludes the effects of intangible assets, purchase accounting adjustments and the related amortization expenses, which totaled $89.4 million and $84.0 million, net of tax, for the years ended December 31, 2005 and 2004, respectively. In addition, cash basis results exclude merger-related and nonrecurring items as discussed in Note 1.

2005 2004

Performance Ratios Based on Operating Earnings (1)Return on average assets 1.60 % 1.62 %Return on average equity 15.12 14.74 Fee income ratio 39.1 37.8 Efficiency ratio 52.5 51.9

Performance Ratios Based on Cash Basis Operating Earnings (1,2)Return on average tangible assets 1.77 % 1.79 %Return on average tangible equity 27.82 27.17 Efficiency ratio 50.4 49.7

Capital RatiosTier 1 risk-based capital ratio 9.3 % 9.2 % Total risk-based capital ratio 14.4 14.5 Tier 1 leverage capital ratio 7.2 7.1 Equity as a percentage of total assets 10.2 10.8

Miscellaneous InformationCommon shares outstanding (in thousands) 543,102 550,406 Basic weighted average shares outstanding (in thousands) 546,916 551,661 Diluted weighted average shares outstanding (in thousands) 551,380 556,041 Shareholders 257,000 255,000 Full-time equivalent employees 27,745 26,148 Banking offices 1,404 1,413 ATMs 1,951 1,930

05BB&T ANNUAL REVIEW

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

Page 6: AR BBT Annual2005

4

BB&T Corporation (“BB&T” or “the Corporation”) is a financial holding company headquartered in Winston-Salem,

North Carolina. With consolidated assets at December 31, 2005, totaling $109.2 billion, BB&T is the ninth largest

banking organization in the United States. As of December 31, 2005, BB&T’s banking subsidiaries operated more

than 1,400 branch offices in eleven states and Washington, D.C.

BB&T’s largest subsidiary, Branch Banking and Trust Company, was founded in 1872 and is the oldest bank based in

North Carolina. Through its subsidiaries, BB&T offers a wide range of lending and deposit services to businesses and

individuals. BB&T’s subsidiaries also provide trust services, wealth management, retail and wholesale insurance services,

investment and capital markets services, leasing, factoring, treasury services, asset management, international

services, payroll processing and bankcard services.

BB&T’s current organization was formed by a merger-of-equals in 1995 between the former BB&T Financial Corporation

and Southern National Corporation. In the past 15 years, BB&T has consummated acquisitions of 53 banks and thrifts,

77 insurance agencies, and 28 nonbank financial services companies.

CORPORATE PROFILE

Page 7: AR BBT Annual2005

5

A B O U T T H E R E V I E W

The BB&T Corporation 2005 Annual Review is presented in a summary format to provide information regarding the

performance of BB&T in a manner that is meaningful and useful to the widest range of readers. The audited consolidated

financial statements of BB&T Corporation and its subsidiaries and other more detailed analytical information regarding

the Corporation are contained in the BB&T Corporation Annual Report on Form 10-K for the year ended December 31,

2005, filed with the Securities and Exchange Commission.

This 2005 Annual Review contains financial information determined by methods other than in accordance with

Generally Accepted Accounting Principles (“GAAP”). BB&T’s management uses these “non-GAAP” measures in their

analysis of the Company’s performance. Non-GAAP measures typically adjust GAAP performance measures to exclude

the effects of charges, expenses or gains related to the consummation of mergers and acquisitions, as well as the

amortization of intangibles and purchase accounting-related adjustments in the case of “cash basis” performance

measures. These non-GAAP measures may also exclude other significant gains, losses or expenses that are unusual in

nature and not expected to recur. Since these items and their impact on BB&T’s performance are difficult to predict,

management believes presentations of financial measures excluding the impact of these items provide useful supple-

mental information that is essential to a proper understanding of BB&T’s core operating results. These disclosures

should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they

necessarily comparable to non-GAAP performance measures that may be presented by other companies.

F O R WA R D - LO O K I N G STAT E M E N T S

This BB&T Corporation 2005 Annual Review contains certain forward-looking statements as defined in the Private

Securities Litigation Reform Act of 1995. These statements may address issues that involve significant risks and

uncertainties. Although we believe that the expectations reflected in this discussion are reasonable, actual results

may be materially different. Please refer to BB&T’s Annual Report on Form 10-K for the year ended December 31,

2005, for a more thorough description of the types of risks and uncertainties that may affect management’s

forward-looking statements.

05BB&T ANNUAL REVIEW

Page 8: AR BBT Annual2005

6

I am pleased to report that 2005 was a strong year

for BB&T, a year in which we achieved many important

strategic and financial goals. 2005 marked the end of

a self-imposed two-year period during which we

determined not to announce any new plans for bank

or thrift acquisitions. Instead, we used this hiatus to

strengthen our core operations and focus our atten-

tion on developing strategies to drive BB&T’s organic

growth. Equipped with the lessons of the last two

years and with the significant investments we have

made for the future, we clearly have tremendous

opportunity at BB&T.

Significant Accomplishments During 2005

2005 represents BB&T’s 24th consecutive year of

record operating earnings. Net income for the year

totaled $1.654 billion, or $3.00 per diluted share.

These amounts reflect increases of 6.1% and 7.1%,

respectively, compared to results for 2004. Excluding

the effects of merger-related items and nonrecurring

charges from both 2005 and 2004, BB&T’s operating

earnings for 2005 totaled $1.674 billion, an increase

of 7.2% compared to the prior year. On a diluted per

share basis, operating earnings for 2005 were $3.04,

an increase of 8.2% compared with 2004.

Cash basis measurements of performance exclude the

effects that intangible assets, purchase accounting

adjustments and the related amortization expenses

have on operating earnings. Many of our internal

financial goals are based on cash basis performance

because we believe these results provide a better

indication of the company’s actual economic perform-

ance. On a cash basis, our operating earnings totaled

$1.763 billion for the year, an increase of 7.1% com-

pared to cash basis operating earnings in 2004. On a

diluted per share basis, cash basis earnings for 2005

were $3.20, up 8.1% compared with 2004. Our cash

basis return on average tangible assets was 1.77% for

2005 and the cash basis return on average tangible

equity was 27.82% for the year. Both percentages

reflect very healthy returns.

The core of BB&T’s business was created 11 years

ago by the merger-of-equals between BB&T Financial

Corporation and Southern National Corporation. We

consider this landmark event in our corporate history

to be the beginning, the yardstick by which we meas-

ure our progress, growth and performance. Over the

last 10 years since the first full year of combined

operations following the merger-of-equals, BB&T

has produced phenomenal balance sheet growth, as

TO OUR SHAREHOLDERS:

Page 9: AR BBT Annual2005

7

John A. Allison

Chairman and Chief Executive Officer

05BB&T ANNUAL REVIEW

Page 10: AR BBT Annual2005

8

With BB&T providing a

strong financial foundation,

the possibilities are infinite.

Our clients come from

all backgrounds and

all walks of life.

They depend on us

to give flight to their dreams,

and we deliver.

Our partnerships are

rooted in careful

money management,

wise investment strategies

and opportunities

to achieve

any goal imaginable.

© 2006 BRYAN LARSEN ALL RIGHTS RESERVED

C O M M U N I T I E SO P P O R T U N I T Y I N O U R

Page 11: AR BBT Annual2005

assets have increased from $20.5 billion to $109.2 bil-

lion, a compound annual growth rate of 18.2%. During

that same 10-year period, operating earnings as origi-

nally reported have increased at a compound annual

rate of 20.7%, an exceptional achievement.

Our combined loan and deposit growth during 2005

was among the strongest in our history, with solid

increases in all our loan categories and 10.2% growth

in average noninterest-bearing deposits. Our loans

also continued to reflect excellent credit quality,

as evidenced by a net charge-off rate of .30% for

2005 compared to an industry average of .64%.

Nonperforming assets improved to .27% of total

assets, also substantially better than the industry

average of .48%.

In addition to our improving performance, BB&T made

important progress on other corporate initiatives. Our

banking network generated 90,000 net new client

accounts during 2005 in connection with the imple-

mentation of strategies to improve organic growth,

reflecting a significant advancement in this measure

compared to recent years. Also, we hired a number of

revenue producers throughout our footprint and are in

the early stages of rolling out an exciting new advertis-

ing campaign. Other successful developments included

improving growth rates in our sales finance business

and success moving market share in our insurance

operations. Combined with investments in our de novo

branch building process, we are positioning the organi-

zation to react more quickly to the marketplace and to

grow core revenues.

9

05BB&T ANNUAL REVIEW

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

Page 12: AR BBT Annual2005

RETURNS TO INVESTORS

BB&T has been a rewarding long-term investment for our shareholders. Unfortunately,

fluctuations in our share price were generally in line with the banking sector during

2005, largely driven by market fears of an interest rate envi-

ronment that has grown more difficult for banks throughout the

year. However, as you can see in the adjacent table, BB&T’s

total return to shareholders has outperformed the S&P 500 and

the S&P Financials over the last 5, 10, 15 and 20 years.

At BB&T, one of our most important objectives is to reward our

shareholders with a growing and dependable cash dividend. To

that end, during 2005 we increased the annual cash dividend

9.0% per share, marking the 34th consecutive year that BB&T

has increased its dividend. We have paid a dividend every year

since 1903. The compound annual growth rate in BB&T’s cash

dividends has been 13.0% over the last 10 years compared to a

4.9% increase in dividends for the S&P 500 Index. Our goal is to pay out between

40% and 50% of our cash basis operating earnings per share in dividends.

10

Total Compound Annual ReturnDecember 31, 2005

BB&T S&P 500 S&P Financials

5 Year 5.7 % .6 % 3.8 %10 Year 15.6 9.1 13.315 Year 18.8 11.5 17.020 Year 14.8 11.9 N/A

For publicly traded companies over the last 20 years 63%, and over the last 78 years 96%, of the total return to shareholders has comefrom dividends and dividend reinvestment.*

*Brandes Institute

In recognition of BB&T’s outstanding track record

of paying dividends, the Company was again

designated as a “Dividend Achiever” by

Mergent, Inc., a provider of global financial

information. Only 2.0% of the 14,000 publicly-

traded companies in the Mergent study

received this recognition. In addition, BB&T

was named to the S&P 500 Index “Dividend

Aristocrats” and S&P’s “High-Yield Dividend

Aristocrats.” The latter designation is designed

to measure the performance of the 50 highest

dividend yielding stocks in the S&P Composite

1500 that have consistently increased their div-

idend for at least 25 years. We are very proud

of these recognitions and remain committed to

rewarding our shareholders.

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

Page 13: AR BBT Annual2005

11

O U R P E O P L EO P P O R T U N I T Y S T A R T S W I T H

People come first at BB&T.

By developing strong.

relationships internally,

we are well-equipped to.

develop equally strong.

relationships with clients.

across our markets.

The fundamental.

difference between.

BB&T and our competitors.

is the commitment.

from each employee.

to make a difference.

in every client relationship.

© 2006 BRYAN LARSEN ALL RIGHTS RESERVED

Page 14: AR BBT Annual2005

12

O U R M I S S I O NTo Make the World a Better Place to Live, by:

Helping our Clients Achieve Economic Successand Financial Security;

Creating a Place Where our Employees canLearn, Grow and be Fulfilled in their Work;

Making the Communities in which we WorkBetter Places to be; and thereby:

Optimizing the Long-Term Return to ourShareholders, while Providing a Safe andSound Investment.

05BB&T ANNUAL REVIEW

Page 15: AR BBT Annual2005

13

OUR VALUES

Values are practical habits that enable us as individ-

uals to live, be successful and achieve happiness in

our lives. At every level of BB&T, our values empower

us to achieve our mission and corporate purpose. We

emphasize 10 core values that are the foundation of

our business philosophy.

1. REALITY. What is, is. If we want to improve, we

must act within the context of reality. The foundation

for quality decision-making is a careful understanding

of the facts.

2. REASON (Objectivity). There is only one “natural

resource” – the human mind. We must be able to

think in an integrated way, thereby avoiding logical

contradictions. Our goal is to objectively make the

best decisions to accomplish our purpose.

3. INDEPENDENT THINKING. We challenge our

employees to use their individual minds to their opti-

mum to make rational decisions. In this context, each

of us is responsible for what we do and who we are.

Creativity is strongly encouraged and is only possible

with independent thought. There is infinite oppor-

tunity for each of us to do whatever we do better.

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

THE BB&T CULTURE

BB&T is a company that has largely been built through acquisitions of existing companies.

Since 1980, we have acquired 72 banking or thrift organizations with approximately $70

billion in assets. Not surprisingly, it is a tremendous challenge to unify the employees of so

many acquired companies to create a culture of common purpose. While we have been

careful to pursue acquisitions of companies with cultures similar to our own, it takes a

committed effort to encourage our employees to embrace and live the BB&T values. We

guide this process by continually emphasizing the meaning and importance of our values,

and as a result, we have seen our company’s culture flourish.

The way we reward our shareholders is by growing revenues and earnings based on the

relationships we build with our clients. Our business is fundamentally about people building

trusting relationships with other people because we care about and are personally committed

to helping our clients achieve their financial goals. Our corporate mission and core values are

ultimately about instilling this basic principle in our people. We believe the strength of our

culture translates into superior performance over time because our employees are self-

motivated to provide excellent service for our clients.

Page 16: AR BBT Annual2005

A significant aspect of self-fulfilling work comes from

creative thought and action.

4. PRODUCTIVITY. We are committed to be producers

of wealth and well-being by taking the actions neces-

sary to accomplish our mission.

5. HONESTY. Being honest is simply being consistent

with reality. To be dishonest is to be in conflict with

reality and is, therefore, self-defeating. We must keep

our agreements with all our constituents.

6. INTEGRITY. BB&T strives to be an organization that

demonstrates the highest level of integrity. Because

we have developed our principles logically, based on

reality, we will always act consistently with our princi-

ples. Regardless of any short-term benefits, acting

inconsistently with our principles is to our long-term

detriment. Therefore, we will not compromise our

principles in any situation.

7. JUSTICE (Fairness). Individuals should be evalu-

ated and rewarded objectively (for better or worse)

based on their contribution to accomplishing our

mission and their adherence to our values. Those who

contribute the most must receive the most. If we treat

our employees justly, we will retain the best employ-

ees and create a long-term competitive advantage.

8. PRIDE. Pride is the psychological reward we earn

from living by our values. Each of us must perform our

work in such a manner that permits us to be justly

proud of what we have accomplished.

9. SELF-ESTEEM (Self-Motivation). We want employ-

ees who have strong personal goals and who expect

to accomplish their goals within the context of our

mission. We want our employees to achieve a high

level of justly earned self-esteem through excellence

in their work.

10. TEAMWORK / MUTUAL SUPPORTIVENESS. While

independent thought and strong personal goals are

critically important, our work is accomplished within

teams. Each of us must consistently act to achieve the

agreed-upon objectives of the team, while acting in a

mutually supportive manner.

14

Our values are more than words on paper. Earlier this year, we publicly announced

a lending policy that is reflective of the impact our corporate values have on our

day-to-day operations. We announced that BB&T would not lend to commercial

developers who plan to build private projects on land taken from private citizens by

government entities using eminent domain. The decision to adopt this policy was

not based on a financial analysis, but rather on what we, as a values-driven com-

pany, believed was the right thing to do. The response to this announcement has

been overwhelmingly positive, as we have received supportive comments from

thousands of clients and shareholders.

Page 17: AR BBT Annual2005

15

“All of our employees are focused on helping our clients achieve economic successand financial security. We consider it a great opportunity to serve our clients byproviding reliable, responsive, empathetic service. Our goal is to provide everyonewe serve with the Perfect Client Experience and for our clients to benefit from themany opportunities at BB&T.”

Kelly S. King

Chief Operating Officer

Page 18: AR BBT Annual2005

16

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

2006 KEY STRATEGIC OBJECTIVES

During our self-imposed hiatus from bank and thrift

acquisitions, we carefully examined our businesses

and identified a number of areas where we can

improve our performance. In 2006 we will focus on

four broad objectives to drive improved results.

1. Achieve Superior Revenue Growth

Organically growing revenues continues to be our

greatest challenge and remains our highest priority in

2006. In addition to continuing to execute on our

world-class sales system (the BB&T Decathlon), we are

implementing a number of additional strategies to

meet this objective. For example, we plan to initiate

the building of 60 new branches throughout our foot-

print in selective high-growth and high-return mar-

kets. In connection with these plans, we are working

to optimize the effectiveness of our branch delivery

system and are developing a centralized strategy to

identify the best locations to open new branches, to

implement customized marketing plans and to staff

the new branches with specially trained financial cen-

ter managers who are particularly skilled in starting

up new locations. With these elements in place, we

will be able to react much more quickly to opportuni-

ties in the marketplace and will have a consistent and

easily replicated “template” for building branches

that will improve our market coverage and drive

growth in market share.

While we have rapidly grown in recent years and

entered a number of new markets, BB&T has only

spent a fraction of what our competitors spend on

advertising and marketing. In the first quarter of 2006

we launched an exciting new advertising and market-

ing campaign led by the positioning statement,

Page 19: AR BBT Annual2005

17

“There’s opportunity here.” With the energy of this

campaign, we will work much harder to communicate

the BB&T difference – that we offer a combination of

market-competitive financial services and expertise to

serve our clients’ most complex financial needs, along

with a culture that places relentless emphasis on

exceptional client service. Our approach includes a

community banking model that places decision-mak-

ing closer to the client than does any other large

financial institution. BB&T combines the personality,

client loyalty and sincerity of a community bank with

the sophisticated, comprehensive expertise of the

biggest banking systems. Our approach is unique and

uniquely beneficial to our clients. Given our successes

in new markets without significant advertising, we

are confident that this new campaign will greatly

strengthen our sales efforts and improve brand

recognition throughout our markets.

We have also made significant investments in the

number of our production personnel. We are investing

in the payroll services business, where we believe

we have an opportunity to capture small business

accounts, providing both payroll processing and

human systems services. We believe these invest-

ments will drive faster revenue growth rates in 2006.

2. Provide World-Standard Client Service

Sales and service are inextricably connected. The fun-

damental difference between BB&T and our competi-

tors is the commitment from each employee to make

a difference in every client relationship. In 2006, we

will strive for excellent execution of the Perfect Client

Experience initiative, which involves fully understand-

ing what our clients expect and aligning our training,

coaching and rewards systems to meet those expecta-

tions. We are also implementing or strengthening

We encourage our employees to see their work as a fundamental purpose in their lives and to pursue it with intensity and excellence.

We are committed to developing our people, because if we have employees who are passionate about providing excellent service and building trusting relationships to help our clients be successful, BB&T and our clients will win in the long term.

05BB&T ANNUAL REVIEW

Page 20: AR BBT Annual2005

18

strategies to improve our problem resolution processes, to provide

excellent execution for transactional services and to deliver excellence in

consultative services.

While we have traditionally enjoyed lower employee turnover than our

competitors, ensuring that we maintain and increase this advantage is

critical to our future success. Quality client service is a function of pro-

viding reliable, empathetic, responsive and competent service – the key

is developing relationships, to know and understand our clients.

Employee turnover is obviously a significant obstacle to developing these

meaningful relationships. We are now more proactive than ever in

reducing turnover in key client contact positions. Our employees in lead-

ership positions will receive special training and will be evaluated based

on specific goals for employee retention.

Ultimately, the success of our

business will be determined by

our ability to fulfill one of the fundamental

commitments of our mission: to help our clients

achieve economic success and financial security.

Fulfilling this commitment requires employees who are

passionate about their work. We encourage our employees to

see their work as a fundamental purpose in their lives and to

pursue it with intensity and excellence. We are committed to devel-

oping our people, because if we have employees who are passionate

about providing excellent service and building trusting relationships

to help our clients be successful, BB&T and our clients will win in the

long term.

3. Accomplish Superior Efficiency, Productivity and

3. Earnings Growth

Our third objective for 2006 is to continue to improve our earnings

growth rate, including an unrelenting commitment to improving efficiency

and productivity. Our objective is to achieve a superior price-to-earnings

ratio by producing superior growth in cash basis earnings per share and

cash basis return on equity, while maintaining a sound financial position.

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

Page 21: AR BBT Annual2005

19

© 2006 BRYAN LARSEN ALL RIGHTS RESERVED

F U T U R EO P P O R T U N I T Y F O R T H E

What’s on the horizon

for 2006 and beyond?

BB&T will continue our

forward momentum,

exploring new territory

with the same passion for

performance that has

driven us for decades.

We consider our

evolution a journey.

Along the way,

we will continue

to learn,

to grow,

to encourage

and challenge one another,

and to unlock

the enormous potential

in each of us.

Page 22: AR BBT Annual2005

Our primary long-term performance goal is to grow

cash basis earnings per share at 10% or greater. Over

the long term we have exceeded this goal, but have

fallen short on our objective over the last couple of

years. As previously outlined, we have made numerous

investments to enhance our revenue production capa-

bilities. We expect these investments to pay off in the

coming years.

4. Execute “Value Improvement Agenda”

Our fourth key objective for 2006 encompasses six

areas where we see significant opportunity to imme-

diately improve performance. First, we want to drive

a higher level of performance for our new regions by

increasing our marketing efforts and fully utilizing our

strong sales culture. In particular, we will strive to

accelerate efficiency improvement and deposit acqui-

sition in these regions. Realizing our potential in new

markets continues to present a tremendous opportu-

nity for revenue growth since more than half of our

regions have been a part of BB&T for less than five

years. While these new regions are improving and

some are doing very well, there are still significant

differences in the overall performance of the new

regions compared to our core regions.

Second, we are devoting extra energy to retail deposit

base relationship growth throughout our regions.

BB&T has long been an organization led by lending.

We see a significant opportunity for profitable deposit

growth in our retail franchise, including increased

new client acquisition, improved retention and greater

cross-sell of deposit products to nondeposit clients.

Our third focal area is commercial deposit base rela-

tionship growth. We believe there is an excellent

opportunity to accelerate our commercial deposit

growth by increasing our incentives for deposit acqui-

sition and refocusing our commercial sales efforts

on “deposit rich” prospects.

Fourth, we want to increase our focus on organic

revenue growth in insurance, particularly through

cross-sell of deposit-based commercial banking

relationships to insurance clients, where we have

excellent opportunities.

Fifth, we want to strengthen our Wealth Management /

Private Banking platform and refocus on deposit

gathering. BB&T has largely been built by acquiring

community banks and thrifts that did not have signifi-

cant trust businesses. Our Wealth Management /

Private Banking business continues to evolve and

expand, and we are optimistic that we are on the

verge of significantly accelerating the growth rates

and profitability of this division.

Finally, we will leverage our competitive advantages

to selectively pursue merger and acquisition partners.

We will be very disciplined in this effort, however, and

will not lose focus on organic growth initiatives. We

believe internal growth is far more important at this

stage than growing through mergers and acquisitions.

20

Page 23: AR BBT Annual2005

21

In closing, I want to extend my sincere appreciation to Alfred E. Cleveland and Albert F. Zettlemoyer, who both

retired from BB&T’s Corporate Board of Directors in 2005. They provided strong leadership and demonstrated a

loyal commitment to BB&T and our shareholders during their years of service. I also want to personally thank

Scott E. Reed, who retired as BB&T’s Chief Financial Officer in June. Scott made a tremendous contribution to

BB&T’s evolution and financial performance during his 33 years with the company, including 24 years as Chief

Financial Officer.

BB&T’s vision is to create the best financial institution possible. Our passion is to consistently provide our clients

with better value through rational innovation and productivity improvement. While we face many challenges, I am

personally very optimistic about BB&T’s future. We have strong relationships with our clients, high-quality employees,

healthy markets, excellent technology and products, rational strategies for growth and profitability and the right

philosophy for future prosperity.

As always, thank you for your support as a BB&T shareholder.

Sincerely,

John A. Allison

Chairman and Chief Executive Officer

February 27, 2006

© 2006 BRYAN LARSEN ALL RIGHTS RESERVED

Page 24: AR BBT Annual2005

22

Corporate Board of Directors

05BB&T ANNUAL REVIEW

John A. Allison IVChairman and Chief Executive OfficerBB&T Corporation and Branch Banking and Trust Company Winston-Salem, NC

Jennifer S. Banner Chief Executive OfficerSchaad PropertiesKnoxville, TN

Anna R. CablikPresidentAnasteel & Supply Company, LLCand Anatek, Inc.Marietta, GA

Nelle R. Chilton Director and President Dickinson Fuel Company, Inc.Charleston, WV

Ronald E. Deal Chairman Wesley Hall, Inc.Hickory, NC

Tom D. Efird PresidentStandard Distributors, Inc. Gastonia, NC

Barry J. Fitzpatrick Chairman Branch Banking and Trust Company of Virginia Great Falls, VA

L. Vincent Hackley, Ph.D. President and Chief Executive OfficerHackley & Associates of North Carolina Chapel Hill, NC

Jane P. Helm Vice Chancellor of Business Affairs Appalachian State University Boone, NC

John P. Howe III, M.D.President and Chief Executive OfficerProject HOPE (Health Opportunities forPeople Everywhere)Washington, D.C.

James H. Maynard Chairman and Chief Executive OfficerInvestors Management CorporationChairmanGolden Corral CorporationRaleigh, NC

Albert O. McCauley President and Chief Executive OfficerMcCauley & McDonald Investments, Inc.Fayetteville, NC

J. Holmes Morrison Retired Chairman, President and Chief Executive OfficerOne Valley Bancorp, Inc.Charleston, WV

Nido R. Qubein PresidentHigh Point UniversityChairmanCreative Services, Inc. High Point, NC

E. Rhone Sasser Retired Chairman and Chief Executive OfficerUnited Carolina Bancshares Corporation Whiteville, NC

Page 25: AR BBT Annual2005

23

Executive Management

John A. Allison IV Chairman and Chief Executive Officer

Ricky K. BrownSenior Executive Vice President and Banking Network Manager

W. Kendall Chalk Senior Executive Vice President and Chief Credit Officer

Barbara F. Duck Senior Executive Vice President and Production and Risk Manager

Robert E. Greene Senior Executive Vice President and Administrative Services Manager

Christopher L. HensonSenior Executive Vice President and Chief Financial Officer

Kelly S. King Chief Operating Officer

Steven B. Wiggs Senior Executive Vice Presidentand Chief Marketing Officer

C. Leon Wilson IIISenior Executive Vice President and Operations Division Manager

Page 26: AR BBT Annual2005

24

Market Coverage

Branch Locations

Percentage of Deposit Market Number ofBB&T’s Deposits (2) Share Rank (2) Branches (3)

North Carolina (1) 27 % 2nd 334Virginia 29 2nd 404Georgia 8 6th 119Kentucky 5 4th 92South Carolina 8 3rd 99West Virginia 6 1st 80Maryland 8 6th 127Tennessee 2 7th 47Florida 5 11th 90Washington, D.C. 2 5th 9

(1) Excludes home office deposits(2) Source: SNL Financial(3) BB&T also operates two branches in Alabama and one branch in Indiana

BB&T Capital Markets

BB&T Commercial Finance

Laureate Capital

BB&T Leasing

Lendmark Financial Services

Prime Rate Premium Finance

She!eld Financial

Vine Street

BB&T Insurance

Scott & Stringfellow

Regional Acceptance

BB&T Community

BB&T Headquarters

Page 27: AR BBT Annual2005

25

Map generated by SpatiaLogic

Page 28: AR BBT Annual2005

26

Shareholder Information

PurposeBB&T’s ultimate purpose is to create superior, long-term economic rewards for our shareholders.

Stock Exchange and Trading SymbolThe common stock of BB&T Corporation is traded on the New York Stock Exchange under the symbol BBT.

Stock Performance*The accompanying graph reflects the performance of a $100 investment in BB&T’s stock since December 31, 1995, theyear end following the completion of the BB&T and Southern National Corporation merger-of-equals, in comparison withother regional competitors, the S&P 500 Financials Index and the S&P 500 Index.

Source: Bloomberg

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

Total Compound Annual Return to Shareholders*

BB&T S&P 500 S&P FinancialsIndex Index

5 Year 5.7 % .6 % 3.8 %10 Year 15.6 9.1 13.315 Year 18.8 11.5 17.020 Year 14.8 11.9 N/A * Assumes reinvestment of all cash dividends in additional

shares of the applicable stock or index.

Page 29: AR BBT Annual2005

27

Quarterly Common Stock Prices and Dividends Paid

2005 2004Quarter High Low Dividend High Low Dividend1st $ 42.24 $ 37.68 $ .35 $ 38.80 $ 34.48 $ .322nd 40.95 37.04 .35 37.91 33.02 .323rd 43.00 38.56 .38 40.46 36.38 .354th 43.92 37.39 .38 43.25 38.67 .35

Selected Market Information 2005 2004 2003 2002 2001

Market capitalization (in billions) $ 22.76 $ 23.14 $ 20.94 $ 17.40 $ 16.45 Book value per share 20.49 19.76 18.33 15.70 13.50 Dividend yield 3.48 % 3.19 % 3.16 % 2.97 % 2.71 % Dividend payout ratio 48.3 47.5 58.4 40.0 45.6

Cash Dividends 2005 2004 2003 2002 2001

Cash dividends paid per share $ 1.46 $ 1.34 $ 1.22 $ 1.10 $ .98 Increase from prior year .12 .12 .12 .12 .12 Percentage increase from prior year 9.0 % 9.8 % 10.9 % 12.2 % 14.0 % Five-year compound annual

growth rate 11.2 % Ten-year compound annual

growth rate 13.0 %

Dividend History BB&T has paid a cash dividend every year since 1903 and has increased its dividend every year for 34 consecutive years.

Dividend Recognitions • S&P 500 Dividend Aristocrats and S&P High Yield

Dividend Aristocrats • Mergent Dividend Achiever

Dividend Reinvestment Plan The Dividend Reinvestment Plan enables shareholders toreinvest dividends and/or invest additional cash in full orfractional shares of BB&T Corporation on a regular basis. For more information, contact Shareholder Services inWinston-Salem, North Carolina, at 336 733-3477.

1.00

3.00

2.00

’04’03’02’01 ’05

Diluted Earnings Per Share$ | based on operating earnings

3.04

.00

1.50

1.25

.25

’04’03’02’01 ’05

Dividends Paid Per Share$

1.46

1.00

.75

.50

’00’99’98’97’96’95

0

60

50

10

’04’03’02’01 ’05

Dividend Payout Ratio%

48.3%

40

30

20

’00’99’98’97’96’95

0.00

3.00

2.00

1.00

’04’03’02’01 ’05

Cash Basis Diluted Earnings Per Share$ | based on cash basis operating earnings

3.20

18.00

28.00

23.00

’04’03’02’01 ’05

Cash Basis Return on Average Common Equity% | based on cash basis operating earnings

27.82

0.0

45.0

15.0

’04’03’02’01 ’05

Cash Basis E!ciency Ratio% | based on cash basis operating earnings

50.4

30.0

0.0

’04’03’02’01 ’05

Fee Income Ratio% | based on operating earnings

39.1

30.0

15.0

0

1,800

1,600

200

’04’03’02’01 ’05

Operating EarningsMillion $

1,674

1,200

800

400

’00’99’98’97’96’95

1,400

1,000

600

0

120

100

’04’03’02’01 ’05

Total AssetsBillion $

109

60

20

’00’99’98’97’96’95

80

40

$100

’04’03’02’01 ’05

BB&T$426

$400

$300

$200

’00’99’98’97’96’95

Bank of America

S&P 500 Financials Index

SunTrustWachovia

S&P 500 Index

As originally reported 10-year compound annual growth rate 18.2%

As originally reported 10-year compound annual growth rate 20.7%

BB&T’s 10-year compound annual dividend growth rate is 13.0% compared to 4.9% for the S&P 500.

“Dividend Achievers represent theelite of the U.S. stock market.”Jonathan WorrallChief Executive Officer, Mergent, Inc.

Page 30: AR BBT Annual2005

28

December 31 December 312005 2004

AssetsCash and due from banks $ 2,185,571 $ 1,782,323 Interest-bearing deposits with banks 410,380 1,003,125 Federal funds sold and securities purchased under resale agreements or similar arrangements 286,233 240,387 Trading securities at fair value 706,518 334,256 Securities available for sale at fair value 19,782,966 18,838,196 Securities held to maturity at amortized cost (fair value: $125 at December 31, 2004) – 125 Loans held for sale 628,834 613,476 Loans and leases, net of unearned income 74,394,654 67,549,125 Allowance for loan and lease losses (825,300 (804,932

Loans and leases, net 73,569,354 66,744,193

Premises and equipment, net of accumulated depreciation 1,286,909 1,283,546 Goodwill 4,255,998 4,124,241 Core deposits and other intangible assets 487,525 513,539 Other assets 5,569,471 5,031,234

Total assets $ 109,169,759 $ 100,508,641

Liabilities and Shareholders’ EquityDeposits:

Noninterest-bearing deposits $ 13,476,939 $ 12,246,248 Savings and interest-checking 4,366,015 4,490,214 Money rate savings 24,548,872 23,427,797 Certificates of deposit and other time deposits 31,889,973 27,535,078

Total deposits 74,281,799 67,699,337

Federal funds purchased, securities sold under repurchase agreements and short-term borrowed funds 6,561,719 6,687,872

Long-term debt 13,118,559 11,419,624 Accounts payable and other liabilities 4,078,568 3,827,334

Total liabilities 98,040,645 89,634,167

Shareholders’ equity:Preferred stock, $5 par, 5,000,000 shares authorized, none issued or

outstanding at December 31, 2005, or at December 31, 2004 – –Common stock, $5 par, 1,000,000,000 shares authorized; 543,102,080 issued and

outstanding at December 31, 2005, and 550,406,287 at December 31, 2004 2,715,510 2,752,032 Additional paid-in capital 2,828,584 3,121,716 Retained earnings 5,951,135 5,112,034 Unvested restricted stock (9,881 (107Accumulated other comprehensive income, net of deferred income

taxes of $(207,319) at December 31, 2005, and $(66,662) at December 31, 2004 (356,234 (111,201

Total shareholders’ equity 11,129,114 10,874,474

Total liabilities and shareholders’ equity $ 109,169,759 $ 100,508,641

Consolidated Balance Sheets

BB&T Corporation and Subsidiaries(Dollars in thousands, except per share data)

) )

) )

) )

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Year Ended Year Ended Year EndedDecember 31 December 31 December 31

2005 2004 2003

Interest IncomeInterest and fees on loans and leases $ 4,684,479 $ 3,851,147 $ 3,591,402 Interest and dividends on securities:

Taxable interest income 739,384 632,779 682,479 Tax-exempt interest income 31,430 32,831 35,930 Dividends 28,540 18,850 37,322

Interest on short-term investments 22,009 11,088 7,659

Total interest income 5,505,842 4,546,695 4,354,792

Interest ExpenseInterest on deposits 1,251,834 729,660 755,677 Interest on federal funds purchased, securities sold under repurchase

agreements and short-term borrowed funds 224,552 90,117 58,842 Interest on long-term debt 504,583 378,695 458,268

Total interest expense 1,980,969 1,198,472 1,272,787

Net Interest Income 3,524,873 3,348,223 3,082,005Provision for credit losses 217,263 249,269 247,585

Net Interest Income After Provision for Credit Losses 3,307,610 3,098,954 2,834,420

Noninterest IncomeService charges on deposits 542,655 523,319 437,524 Mortgage banking income 103,757 110,075 109,423 Trust income 140,630 119,479 113,227 Investment banking and brokerage fees and commissions 289,647 264,789 247,394 Insurance commissions 714,189 619,055 395,820 Bankcard fees and merchant discounts 112,132 102,098 83,927 Other nondeposit fees and commissions 257,173 216,498 180,045 Securities gains, net 113 6,133 126,211 Income from bank-owned life insurance 93,770 91,883 98,700 Other income 71,556 65,942 35,068

Total noninterest income 2,325,622 2,119,271 1,827,339

Noninterest ExpensePersonnel expenses 1,785,204 1,631,757 1,445,540 Occupancy and equipment expenses 471,498 415,524 371,167 Amortization of intangibles 112,307 106,348 55,650 Professional services 93,272 75,822 70,518 Merger-related and restructuring (gains) charges (10,741 5,518 89,775 Loss on early extinguishment of debt 2,943 – 384,898 Loan processing expenses 98,239 84,253 78,887 Other expenses 613,779 576,641 548,294

Total noninterest expense 3,166,501 2,895,863 3,044,729

Income Before Income Taxes 2,466,731 2,322,362 1,617,030 Provision for income taxes 812,962 763,987 552,127

Net Income $ 1,653,769 $ 1,558,375 $ 1,064,903

Basic Earnings Per Share $ 3.02 $ 2.82 $ 2.09

Diluted Earnings Per Share $ 3.00 $ 2.80 $ 2.07

Cash Dividends Paid Per Common Share $ 1.46 $ 1.34 $ 1.22

Consolidated Statements of Income

BB&T Corporation and Subsidiaries(Dollars in thousands, except per share data)

)

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Year Year Year Year Year Year Five-YearEnded Ended Ended Ended Ended Ended Compound12/31 12/31 12/31 12/31 12/31 12/31 Growth

2005 2004 2003 2002 2001 2000 RateSummary of Operating EarningsInterest income $ 5,506 $ 4,546 $ 4,287 $ 4,434 $ 4,851 $ 4,878 2.4 %Interest expense 1,981 1,198 1,273 1,687 2,415 2,564 (5.0

Net interest income 3,525 3,348 3,014 2,747 2,436 2,314 8.8 Provision for credit losses 217 249 248 263 188 117 13.1

Net interest income after provisionfor credit losses 3,308 3,099 2,766 2,484 2,248 2,197 8.5

Noninterest income 2,324 2,119 1,827 1,541 1,246 1,043 17.4 Noninterest expense 3,133 2,890 2,548 2,195 1,943 1,830 11.4

Operating earnings before income taxes 2,499 2,328 2,045 1,830 1,551 1,410 12.1 Provision for income taxes 825 766 621 512 451 452 12.8

Operating earnings 1,674 1,562 1,424 1,318 1,100 958 11.8 Merger-related charges, net of tax 7 (4 (55 (25 (154 (115 NM Other, net of tax (1) (27 – (304 10 28 (145 NM

Net income $ 1,654 1,558 1,065 1,303 974 698 18.8 %

Per Share Based on Operating EarningsBasic $ 3.06 $ 2.83 $ 2.79 $ 2.78 $ 2.43 $ 2.12 7.6 %Diluted 3.04 2.81 2.77 2.75 2.40 2.10 7.7

Per Share Based on Net IncomeBasic $ 3.02 $ 2.82 $ 2.09 $ 2.75 $ 2.15 $ 1.55 14.3 %Diluted 3.00 2.80 2.07 2.72 2.12 1.53 14.4

Cash dividends paid 1.46 1.34 1.22 1.10 .98 .86 11.2 Book value 20.49 19.76 18.33 15.70 13.50 11.96 11.4

Selected Average Balances Assets $ 104,612 $ 96,276 $ 85,328 $ 75,779 $ 68,823 $ 61,813 11.1 %Earning assets 92,703 84,946 75,463 68,230 62,905 57,616 10.0 Securities, at amortized cost 20,467 18,218 17,058 16,939 15,887 15,241 6.1 Loans and leases 71,517 66,107 57,857 50,851 46,588 41,934 11.3 Deposits 70,346 64,816 56,948 49,118 44,242 41,416 11.2 Interest-bearing liabilities 76,813 70,610 64,285 59,444 55,330 50,135 8.9 Shareholders’ equity 11,065 10,597 8,895 7,113 5,802 4,911 17.6

Selected Year-End Balances Assets $ 109,170 $ 100,509 $ 90,467 $ 80,217 $ 70,870 $ 66,553 10.4 %Earning assets 96,777 88,718 79,209 71,228 64,087 60,987 9.7 Securities, at carrying value 20,489 19,173 16,317 17,803 16,760 15,950 5.1 Loans and leases 75,023 68,163 62,305 53,518 47,443 44,827 10.8 Deposits 74,282 67,699 59,350 51,280 44,733 43,877 11.1 Interest-bearing liabilities 80,485 73,561 66,394 62,400 56,164 53,655 8.4 Shareholders’ equity 11,129 10,874 9,935 7,388 6,150 5,420 15.5

Selected Financial Data

BB&T Corporation and Subsidiaries(Dollars in millions, except per share data)

)

(1) In addition to merger-related charges, operating earnings also exclude a one-time charge related to the accounting for leases totaling $26.6 million, net of tax, in 2005, nonre-curring contributions made by an affiliated trust, losses on early extinguishment of debt, and a one-time charge related to deferred taxes associated with BB&T's leasing opera-tions, which collectively totaled $303.9 million, net of tax, in 2003, a nonrecurring gain resulting from the implementation of a new accounting principle totaling $9.8 million in2002, a one-time gain on an investment in an electronic transaction processing company partially offset by a provision for the impairment of mortgage servicing rights totaling$28.2 million, net of tax, in 2001, and $145.3 million in net after-tax losses from a restructuring of the securities portfolio in 2000.

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2005 2004 2003 2002 2001

Performance Ratios Based on Net IncomeReturn on average assets 1.58 % 1.62 % 1.25 % 1.72 % 1.41 % Return on average equity 14.95 14.71 11.97 18.32 16.78 Fee income ratio (fully taxable equivalent) 39.1 37.8 36.5 34.6 32.8 Efficiency ratio (fully taxable equivalent) 53.1 52.0 62.8 50.4 55.4 Net interest margin (fully taxable equivalent) 3.89 4.04 4.06 4.25 4.17

Performance Ratios Based on Operating Earnings (1)Return on average assets 1.60 % 1.62 % 1.67 % 1.74 % 1.60 % Return on average equity 15.12 14.74 16.01 18.53 18.96 Fee income ratio (fully taxable equivalent) 39.1 37.8 36.0 34.5 32.0 Efficiency ratio (fully taxable equivalent) 52.5 51.9 51.8 49.5 50.2 Net interest margin (fully taxable equivalent) 3.89 4.04 4.15 4.25 4.18

Performance Ratios Based on Cash Basis Operating Earnings (1,2)Return on average tangible assets 1.77 % 1.79 % 1.78 % 1.79 % 1.72 % Return on average tangible equity 27.82 27.17 24.81 23.93 23.58 Efficiency ratio (fully taxable equivalent) 50.4 49.7 50.5 49.0 48.4

Capital RatiosAverage equity to average assets 10.6 % 11.0 % 10.4 % 9.4 % 8.4 % Equity to assets at year end 10.2 10.8 11.0 9.2 8.7 Risk-based capital ratios:

Tier 1 capital 9.3 9.2 9.4 9.2 9.8 Total capital 14.4 14.5 12.5 13.4 13.3

Tier 1 leverage ratio 7.2 7.1 7.2 6.9 7.2

Credit Quality Ratios (3)Nonaccrual loans and leases as a percentage of total loans and leases .31 % .39 % .56 % .70 % .67 % Nonperforming assets as a percentage of:

Total assets .27 .36 .49 .56 .53 Loans and leases plus foreclosed property .40 .52 .72 .84 .79

Net charge-offs as a percentage of average loans and leases .30 .36 .43 .48 .40 Net charge-offs as a percentage of average loans and leases

excluding specialized lending operations (4) .19 .24 .32 .38 .34 Allowance for loan and lease losses as a percentage of loans and leases 1.10 1.18 1.26 1.35 1.36 Ratio of allowance for loan and lease losses to net charge-offs 3.84 x 3.42 x 3.17 x 2.94 x 3.44 x

Selected Ratios

BB&T Corporation and Subsidiaries

(1) Operating earnings exclude the effects of merger-related charges, which totaled $(6.8 million), $3.5 million, $55.1 million, $24.7 million and $154.7 million, net of tax, for the yearsended December 31, 2005, 2004, 2003, 2002 and 2001, respectively. Operating earnings also exclude a one-time charge related to the accounting for leases, which totaled $26.6 mil-lion, net of tax, in 2005, nonrecurring contributions made by an affiliated trust, losses on early extinguishment of debt, and a one-time charge related to deferred taxes associated withBB&T’s leasing operations, which collectively totaled $303.9 million, net of tax, in 2003, a nonrecurring gain resulting from the implementation of a new accounting principle totaling$9.8 million in 2002, and $28.2 million resulting from a one-time gain on an investment in an electronic transaction processing company offset by a provision for the impairment ofmortgage servicing rights in 2001.

(2) Information presented on a cash basis excludes the effects of intangible assets, purchase accounting adjustments and the related amortization expenses, which totaled $89.4 million,$84.0 million, $41.8 million, $12.7 million and $69.0 million, net of tax, for the years ended December 31, 2005, 2004, 2003, 2002 and 2001, respectively. In addition, cash basis resultsexclude merger-related charges and nonrecurring items as discussed in Note 1.

(3) Loans and leases are net of unearned income and include loans held for sale.

(4) Excludes net charge-offs and average loans from BB&T’s specialized lending operations.

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Form 10-KBB&T Corporation files an Annual Report on Form 10-K with the Securities and ExchangeCommission each year. A copy of this report may be obtained upon written request to:

Christopher L. Henson, Senior Executive Vice President and Chief Financial OfficerBB&T Corporation200 West Second StreetPO Box 1250Winston-Salem, NC 27102-1250

Equal Opportunity EmployerBB&T Corporation is an equal opportunity employer. All matters regarding recruiting,hiring, training, compensation, benefits, promotions, transfers and all other personnelpolicies will continue to be free from discriminatory practices.

Analyst InformationAnalysts, investors and others seeking additional financial information should contact:

Thomas A. Nicholson, Jr., Executive Vice President Investor Relations336 733-3058

News MediaNews media representatives seeking information should contact:

Robert A. Denham, Senior Vice PresidentPublic Relations910 914-9073

Shareholder InformationShareholders seeking information regarding dividends, lost certificates or other generalinformation should contact:

Shareholder Services336 733-3477toll-free 800 682-6902 x33477

Please submit address changes in writing to:BB&T Shareholder Services150 South Stratford RoadSuite 300Winston-Salem, NC 27104

ClientsClients seeking assistance with BB&T products and services should call 1-800-BANK BBT (1-800-226-5228).

Web SitePlease visit www.BBT.com for information concerning BB&T’s products and services,news releases, financial information, corporate governance practices and otherinformation relating to BB&T.

05BB&T ANNUAL REVIEW

General Information

Corporate HeadquartersBB&T Corporation200 West Second StreetPO Box 1250Winston-Salem, NC 27102-1250336 733-2000

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BB&T Corporation

200 West Second Street

PO Box 1250

Winston-Salem, NC 27102-1250

C0001125018

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