SunTrust Banks, Inc. reports a net loss for the first quarter of 2009 of USD815.2 million compared to net income of USD290.6 million in the first quarter of 2008.
Net loss per average common diluted share was USD2.49 compared to net income per average common diluted share of USD0.81 in the first quarter of 2008. The majority of the first quarter loss to common shareholders was attributable to a non-cash, after-tax charge of USD714.8 million, or USD2.03 per share, related to the impairment of goodwill.
The goodwill impairment charge had no impact on the Company’s strong regulatory capital and tangible equity ratios. Excluding the impairment charge, the loss in the first quarter was USD0.46 per common share compared to a loss of USD1.07 per common share in the fourth quarter of 2008. The loss in the fourth quarter was primarily attributable to higher recession-related credit costs.
“There are two clear messages that emerge from our first quarter results,” says James M. Wells III, chairman and chief executive officer, SunTrust. “First, SunTrust, like other financial institutions, is still working through credit and earnings challenges as the weak economy continues to take a toll on performance. Second, there are some preliminary signs of improvement in several key areas, including mortgage originations, consumer and commercial deposit growth, and early-stage delinquencies.”
“Given that economic challenges remain, SunTrust is sharply focused on maintaining a strong capital position and mitigating near-term recession-related risk. At the same time, we continue to implement initiatives to take advantage of post-cycle growth opportunities. We are enhancing execution, improving service quality, and executing on numerous additional tactics to augment overall client satisfaction. Our record level of deposit growth is good evidence of these efforts and, coupled with our continued focus on core expense management, has positive implications for the future.”
L.D.