Suntrust 1Q15 Earnings Call Notes

No meaningful delinquencies or defaults in energy

“With respect to our energy portfolio, we have not seen any meaningful delinquencies or defaults. During the quarter, we updated credit ratings, resulting in some migration, and we expect that to be ongoing, which is why we have proactively built reserves for this portfolio.”

Wholesale banking a key growth engine

“Turning to whole sale, whole sale banking continues to be a key growth engine for the company. Looking at the numbers on an adjusted basis, net income was up 18% year-over-year, driven by solid revenue growth and further asset quality improvement.”

Not focused on M&A right now

“Well, I think the continued investment right now is in our business. The bank that we like the most is SunTrust. We’ve got third biggest retail operation in our markets, the fourth largest mortgage company. We’ve got great momentum in our investment banking operations. So we are going to continue to invest in those things, funded by some of the expense savings and opportunities that we are creating.

I presume without the green light if we wanted to do something on the M&A side, where we think about things that are potentially accretive to a really strong franchise, yes, but those are not a lot of them. So, 12 and 18 months is a long time. Our focus right now continues to be highly and mostly focused on SunTrust.”

Hopefully regulators ease capital requirements at some point

“I would hope that over the course of the medium term, that the regulators would allow the industry to be able to shrink capital level overall. If I think about where we could end up in that type of environment, I think that we would likely end up as some kind of ratio below nine; something that starts with an eight probably seems like it would be certainly adequate for the need that we have as a company to support our client needs, and be able to withstand the rigorous CCAR stress test.”