SunTrust 2013 Annual Report Download - page 162

Notes to Consolidated Financial Statements, continued
146
At December 31, 2013 and 2012, these reserve requirements totaled $2.0 billion and $1.9 billion, respectively and were
fulfilled with a combination of cash on hand and deposits at the Federal Reserve.
Capital Ratios
The Company is subject to various regulatory capital requirements which involve quantitative measures of the Company’s
assets. Capital ratios at December 31 consisted of the following:
2013 2012
(Dollars in millions) Amount Ratio Amount Ratio
SunTrust Banks, Inc.
Tier 1 common $14,602 9.82% $13,509 10.04%
Tier 1 capital 16,073 10.81 14,975 11.13
Total capital 19,052 12.81 18,131 13.48
Tier 1 leverage 9.58 8.91
SunTrust Bank
Tier 1 capital $16,059 10.96% $15,121 11.38%
Total capital 18,810 12.84 18,056 13.59
Tier 1 leverage 9.78 9.23
On October 11, 2013, the Federal Reserve published final rules in the Federal Register related to required minimum capital
ratios that become effective for the Company and the Bank on January 1, 2015. Under the final Basel III rules in the U.S., the
minimum capital requirements contain thresholds for Common Equity Tier 1 ratio of 4.5%; Tier 1 Capital ratio of 6%; Total
Capital ratio of 8%; U.S. Leverage ratio of 4%; and a capital conservation buffer of 2.5% of RWA.
At December 31, 2013, the Company had $627 million in trust preferred securities outstanding. The final Basel III capital
rules require the phase out of non-qualifying Tier 1 Capital instruments such as trust preferred securities. As such, over a 2-
year period beginning on January 1, 2015, approximately $627 million in principal amount of the Company's trust preferred
and other hybrid capital securities currently outstanding will no longer qualify for Tier 1 capital treatment, but instead will
qualify for Tier 2 capital treatment. Accordingly, the Company anticipates that, by January 1, 2016, all $627 million of its
outstanding trust preferred securities will lose Tier 1 capital treatment, and will be reclassified as Tier 2 capital.
Preferred Stock
Preferred stock at December 31 consisted of the following:
(Dollars in millions) 2013 2012
Series A (1,725 shares outstanding) $172 $172
Series B (1,025 shares outstanding) 103 103
Series E (4,500 shares outstanding) 450 450
Total preferred stock $725 $725
In September 2006, the Company authorized and 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 A Preferred Stock has no stated maturity and will not be subject to any sinking fund or other obligation of
the Company. Dividends on the Series A Preferred Stock, if declared, will accrue and be payable quarterly at a rate per annum
equal to the greater of three-month LIBOR plus 0.53%, or 4.00%. Dividends on the shares are noncumulative. Shares of the
Series A Preferred Stock have priority over the Company’s common stock with regard to the payment of dividends and, as
such, the Company may not pay dividends on or repurchase, redeem, or otherwise acquire for consideration shares of its
common stock unless dividends for the Series A Preferred Stock have been declared for that period and sufficient funds have
been set aside to make payment. During 2009, the Company repurchased 3,275 shares of the Series A Preferred Stock. In
September 2011, the Series A Preferred Stock became redeemable at the Company’s option at a redemption price equal to
$100,000 per share, plus any declared and unpaid dividends. Except in certain limited circumstances, the Series A Preferred
Stock does not have any voting rights.