SunTrust Banks, Inc. (STI): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report
SunTrust's third-quarter 2014 earnings lagged the Zacks Consensus Estimate by a penny. Growth in revenues, lower non-interest expenses and a fall in provision for credit losses supported the results. We believe that improving credit quality and a favorable deposit mix will continue to act as the driving forces at SunTrust. Moreover, consistent capital deployment activities will likely boost shareholders' confidence. Further, efficient cost-containment efforts amid a sluggish economic recovery seem encouraging. Nevertheless, we remain concerned about the company's subdued top-line growth, exposure to risky assets and continued regulatory pressures.
Incorporated in 1984 under the laws of the state of Georgia and headquartered in Atlanta, GA, SunTrust Banks Inc. is a diversified financial services holding company. The company operates through its principal banking subsidiary SunTrust Bank, which provides various financial services to individuals and corporate customers in the U.S.
SunTrust reports it business through following segments:
The Consumer Banking and Private Wealth Management segment is made up of two main businesses: Consumer Banking and Private Wealth Management. The former offers financial products and services that include consumer deposits, home equity lines, consumer lines, indirect auto, student lending, bank card and other consumer loan and fee-based products. The latter provides a wide array of wealth-management products and professional services to both individual and institutional clients including brokerage, professional investment management and trust services to clients seeking active management of their financial resources.
The Wholesale Banking segment includes four businesses Corporate & Investment Banking, Commercial and Business Banking, Commercial Real Estate, Treasury and Payment Solutions.
The Mortgage Banking segment provides residential mortgage products nationally through its retail, broker and correspondent channels, as well as via Internet and telephone. These products are either sold in the secondary market or held in the company's loan portfolio.
Corporate Other includes management of the company's investment securities portfolio, long-term debt, end user derivative instruments, short-term liquidity and funding activities, balance sheet risk management and most real estate assets.
In Apr 2014, SunTrust Robinson Humphrey, the corporate and investment banking arm of SunTrust, acquired Lantana Oil & Gas Partners. Lantana offers advisory services for acquisition and divestiture (A&D) deals in the upstream sector. The sector primarily focuses on exploration and production (E&P) in the oil and gas industry.
In May 2014, SunTrust completed the divestiture of its asset management subsidiary, RidgeWorth Capital Management, Inc., to an investor group led by a private equity fund managed by Lightyear Capital LLC. The company received cash proceeds of $193 million from the sale.
As of Sep 30, 2014, SunTrust had total assets of $186.8 billion, total loans of $132.2 billion, total deposits of $136.5 billion and shareholders' equity of $22.3 billion. As of that date, the company operated 1,454 full-service banking offices and 2,192 ATMs in Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee, Virginia and the District of Columbia.