June 19 (Bloomberg) -- BB&T Corp. fell the most since November 1991 after Sterne Agee & Leach Inc. said the bank may have to cut its dividend by more than half following credit- related losses.

BB&T dropped 9.4 percent to an eight-year low of $22.05 in 1:46 p.m. New York Stock Exchange composite trading. The shares have fallen 28 percent this year as financial companies record losses from uncollectible loans.

Sterne Agee analysts Adam Barkstrom and William Griffin reiterated their recommendation to sell the Winston-Salem, North Carolina-based company's shares, saying there is a ``strong probability'' of a dividend cut based on losses from bad loans. The reduction may be more than 50 percent, the analysts said.

``If our loss assumptions are too lenient, a further dividend cut will be required and we would not rule out a recap scenario occurring,'' Barkstrom and Griffin wrote.

BB&T spokesman Bob Denham declined to comment. The company said April 17 that it expected to increase its dividend this year. The third-biggest bank based in North Carolina currently pays a 46-cent quarterly dividend.

The analysts lowered their share-price estimate to $21 from $25 based on concerns over credit quality and ``increasingly negative sentiment'' for financial companies.

To contact the reporter on this story: Katherine Greene in New York at kgreene8@bloomberg.net.

Last Updated: June 19, 2008 13:54 EDT