SunTrust 2011 Annual Report Download - page 157
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Please find page 157 of the 2011 SunTrust annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Notes to Consolidated Financial Statements (Continued)
141
NOTE 14 – CAPITAL
In March 2011, the Federal Reserve completed its review of the Company’s capital plan in connection with the CCAR. Upon
completion of the review, the Federal Reserve did not object to the Company’s capital plan as originally submitted in January
2011. As a result, during the first quarter of 2011, the Company completed a $1.0 billion common stock offering and a $1.0 billion
senior debt offering, which pays 3.60% interest and is due in 2016.
On March 30, 2011, the Company used the proceeds from these offerings as well as from other available funds to repurchase $3.5
billion of Fixed Rate Cumulative Preferred Stock, Series C, and $1.4 billion of Fixed Rate Cumulative Preferred Stock, Series D,
that was issued to the U.S. Treasury under the TARP’s CPP in 2008. As a result of the repurchase of Series C and D Preferred
Stock, the Company incurred a one-time non-cash charge to net income/(loss) available to common shareholders of $74 million
related to accelerating the outstanding discount accretion on the Series C and D Preferred Stock. The discount associated with the
Series C and D Preferred Stock was being amortized over a five-year period from each respective issuance date using the effective
yield method and totaled $6 million, $25 million and $23 million during 2011, 2010 and 2009, respectively.
On January 9, 2012, the Company submitted its latest CCAR capital plan which is currently under review by the Federal Reserve.
The Company is subject to various regulatory capital requirements which involve quantitative measures of the Company’s assets.
Capital Ratios
Capital ratios at December 31, consisted of the following:
(Dollars in millions)
SunTrust Banks, Inc.
Tier 1 common
Tier 1 capital
Total capital
Tier 1 leverage
SunTrust Bank
Tier 1 capital
Total capital
Tier 1 leverage
2011
Amount
$12,254
14,490
18,177
$14,026
17,209
Ratio
9.22%
10.90
13.67
8.75
10.70%
13.13
8.69
2010
Amount
$10,737
18,156
21,967
$13,120
16,424
Ratio
8.08%
13.67
16.54
10.94
10.05%
12.58
8.33
Substantially all of the Company’s retained earnings are undistributed earnings of the Bank, which are restricted by various
regulations administered by federal and state bank regulatory authorities. There was no capacity for payment of cash dividends
to the Parent Company under these regulations at December 31, 2011 and 2010. At January 1, 2012, retained earnings of the Bank
available for payment of cash dividends to the Parent Company under these regulations totaled approximately $697 million.
Additionally, the Federal Reserve requires the Company to maintain cash reserves. As of December 31, 2011 and 2010, these
reserve requirements totaled $1.7 billion and $1.4 billion, respectively and were fulfilled with a combination of cash on hand and
deposits at the Federal Reserve.
Preferred Stock
Preferred stock at December 31 consisted of the following:
(Dollars in millions)
Series A (1,725 shares outstanding)
Series B (1,025 shares outstanding at December 31, 2011)
Series C (35,000 shares outstanding at December 31, 2010)
Series D (13,500 shares outstanding at December 31, 2010)
2011
$172
103
—
—
$275
2010
$172
—
3,442
1,328
$4,942
On September 12, 2006, the Company issued depositary shares representing ownership interests in 5,000 shares of Perpetual
Preferred Stock, Series A, no par value and $100,000 liquidation preference per share (the “Series A Preferred Stock”). The Series