BB&T records charge for disputed tax liability
WINSTON-SALEM, N.C., Feb. 26, 2013
WINSTON-SALEM, N.C., Feb. 26, 2013 /PRNewswire/ -- BB&T Corporation (NYSE:
BBT) today announced that it will record a charge of $281 million in the first
quarter to increase its reserves related to an ongoing disputed tax liability.
The decision follows a Feb. 11 opinion by the U.S. Tax Court with respect to a
case between the Bank of New York Mellon Corporation and the IRS involving a
transaction with a structure similar to a financing transaction entered into
by BB&T in 2002. BB&T is currently in litigation with the IRS to recover a
previous assessment of $892 million.
BB&T has confidence in its position in the dispute because, among other
reasons, BB&T will raise arguments and issues in its case that were not
considered by the Tax Court. However, management recorded the charge as a
result of its consideration of this adverse opinion.
The tax reserves relate to an IRS statutory notice of deficiency for the tax
years 2002 – 2007 asserting a liability for taxes, penalties and interest of
$892 million related to the disallowance of foreign tax credits and other
deductions claimed in connection with the financing transaction. BB&T paid the
assessment in 2010 and filed a lawsuit seeking a refund in the U.S. Court of
Federal Claims. The court has scheduled the trial to begin on March 4. BB&T
recorded a receivable for the amount of the payment, less reserves. Following
this charge, it is possible that BB&T will decrease tax reserves by as much as
$496 million or increase reserves by as much as $328 million as the litigation
This news release 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, uncertainties, estimates and
assumptions made by management. Actual results may differ materially from
current projections. Please refer to BB&T's filings with the Securities and
Exchange Commission for a summary of important factors that may affect BB&T's
forward-looking statements. BB&T undertakes no obligation to revise these
statements following the date of this news release.
BB&T Corporation (NYSE: BBT) is one of the largest financial services holding
companies in the U.S. with $183.9 billion in assets, market capitalization of
$20.4 billion and 1,832 financial centers in 12 states and Washington, D.C.,
as of Dec. 31, 2012. Based in Winston-Salem, N.C., the company offers a full
range of consumer and commercial banking, securities brokerage, asset
management, mortgage and insurance products and services. A Fortune 500
company, BB&T is consistently recognized for outstanding client satisfaction
by J.D. Power and Associates, the U.S. Small Business Administration,
Greenwich Associates and others. More information about BB&T and its full line
of products and services is available at www.BBT.com.
SOURCE BB&T Corporation
Contact: ANALYSTS: Alan Greer, Executive Vice President, Investor Relations,
+1-336-733-3021, AGreer@BBandT.com; MEDIA: Cynthia Williams, Senior Executive
Vice President, Corporate Communications, +1-336-733-1478,
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