BB&T to repay bailout funds, cut dividend
Regional bank says it will sell $1.5 billion in stock and cut its dividend to repay federal aid is says 'creates excessive controls.'
NEW YORK (Reuters) -- BB&T Corp, a large U.S. regional bank and vocal critic of the government's bank bailout plan, said on Monday it would sell $1.5 billion of stock and reduce its dividend by 68% so that it can repay a $3.1 billion investment.
Winston-Salem, North Carolina-based BB&T was one of the 19 lenders to undergo government "stress tests" of their ability to weather a long and deep economic downturn, and was one of nine found not to need more capital.
Chief Executive Kelly King said on April 17 that the bank now views as "destructive" its participation in the government's bailout plan, the Troubled Asset Relief Program. "It creates excessive controls, it has a negative impact on our people and our strategies, (and) it runs a great risk of politicizing the lending process, which is very unhealthy," he said.
BB&T reduced its quarterly dividend to 15 cents per share from 47 cents after having raised it for 37 consecutive years. BB&T said the reduction would save $725 million a year. King said the decision marked "the worst day in my 37-year career," and pledged to increase the payout when he can.
BB&T ended March with $143.4 billion of assets. It operates 1,504 branches in 11 states and Washington, D.C.
Goldman Sachs & Co (GS, Fortune 500), JPMorgan (JPM, Fortune 500) and Morgan Stanley (MS, Fortune 500) are arranging the stock offering. BB&T (BBT, Fortune 500) shares closed Friday at $26.33 on the New York Stock Exchange. 
