SunTrust swings to profit in 2Q, beats estimates
SunTrust Banks Inc. (STI) reported net income of $174 million, or 33 cents per share, for the second quarter, as asset quality improved. Second-quarter results improved significantly from a loss of $56 million, or 11 cents per share, for the year-ago second quarter. Analysts expected SunTrust to earn 31 cents a share, on average, for the three months ended June 30, according to Yahoo Finance. Revenue for the quarter was $2.2 billion, up from $2.16 billion a year ago. "While the economic recovery remains uneven, we continued to demonstrate meaningful improvements in asset quality," said William Rogers Jr., SunTrust’s president and CEO. Rogers assumed the top spot of the bank June 1, replacing James Wells, who is retiring. The Atlanta-based regional bank's credit quality improved with net charge-offs, nonperforming loans, nonperforming assets and early stage delinquencies all declining. Nonperforming loans declined for the eighth consecutive quarter, clocking in at 3.14% of total loans, decreasing 9% from the prior quarter and 23% from a year earlier. Net charge-offs declined 12% and 30%, respectively. Mortgage servicing income was $72 million in the second quarter, down from $88 million. Mortgage production income was only $4 million, but that was an improvement over a negative $10 million in the year-ago quarter. Mortgage repurchase costs were $90 million, up $10 million from the prior quarter due to higher agency-related repurchase requests, SunTrust said. At June 30, reserves for mortgage repurchases totaled $299 million, an increase of $29 million from March 31, reflective of higher unresolved repurchase requests. The mortgage servicing portfolio was $162.9 billion at the end of the second quarter. Write to Kerry Curry. Follow her on Twitter @communicatorKLC.